MANILA, Philippines - Indepdendent think-tank Ibon Foundation says it is skeptical about the findings of a review committee that cleared oil companies of overpricing charges.
Ibon says it's not clear if the committee, headed by former Budget Secretary Benjamin Diokno, was actually able to open oil companies' books to study supply contracts and inventory data.
"It is important for the committee to have looked at supply contracts to know the prices actually paid, as well as how inventories are valued to see if windfall profits are made," Ibon Foundation said in a statement.
Ibon claims there may be discrepancies in the amount paid by oil companies for importing oil and how the inventories are valued.
In its report released yesterday, the committee had said it used 3 ways in determining whether oil players are making excessive profits. The committee said the profits of oil companies were reasonable and there is nothing extraordinary about local oil prices.
Ibon Foundation also questioned the committee's recommendation to continue the oil deregulation law.
"Oil giants can afford to have a lower profit margin or even appear to operate on a loss because their mother units have already earned superprofits even before their products reach the local pump stations. Promoting continued deregulation of the oil industry means allowing oil giants to continue making these profits and maintain their position in the industry at the expense of the public," the research group said.
The audit was commissioned by the Department of Energy.
Smaller oil companies, meanwhile, welcomed the findings, which they said are "objective."
"From the beginning, we have expressed confidence that what they will arrive at will be the objective reality of a highly competetive market devoid of any overpricing," Fernando Martinez, president of the Independent Philippine Petroleum Companies Association, said. - With ANC