Recto wants ‘greed check’ on oil firms

Business Mirror

Posted at Oct 23 2010 11:18 PM | Updated as of Oct 24 2010 07:18 AM

MANILA, Philippines - TheDepartment of Energy (DOE) has to “do a greed check” of all oil companies to verify whether the latest round of pump price increases, imposed even as the country is reeling from a disastrous typhoon, was justified.

This is what Sen. Ralph Recto called on the department to implement, especially since the DOE had “promised us a close and stronger monitoring of the price increases by oil companies. We are now calling in that promise.”

In a statement, Recto noted the widespread public disapproval of the oil firms’ 50 centavos per liter price hike in the mid of Supertyphoon Juan and denounced it as “the most foul and insensitive move of the oil firms so far” recalling that even as “roofs and farm crops are being ripped off by Typhoon Juan’s ferocious wind, our benevolent oil players just decided to delight us with their own ripping off.”

Recto said he “dreaded what these oil players will do if a major earthquake or tsunami accidentally hit the country. If the value of the onslaught of typhoon Juan is an instant trigger of 50 centavos increase per liter, the corresponding value for a major, major catastrophe would surely be horrendous.”

Recto also complained that the DOE did not even bother to call the attention of the oil companies on the bad timing of the price increase. “They [DOE] should come out and say whether the price is correct or not, because they know the right computation, especially now.”

Recto, who sits as vice-chairman of the Senate finance committee, noted that in the last budget hearing, Energy Secretary Rene Almendras promised to strengthen the task force composed of the DOE and the Department of Justice. “We must hear more from the department every time there is price increase in oil products.”

If the reason for the latest increase is higher international prices, the senator insisted that there should also be an offsetting impact from the continuous appreciation of the peso, which is now trading at P43.375 to the dollar.

Only last month, Recto recalled the same oil players increased its prices by P1.25 per liter. Since February 2009, he added, pump prices of unleaded gasoline have increased by P11.75 to P43.75 from P32 per liter early last year or a price expansion of about 36.7 perceny.

He also noted that as of October 12, the retail price of the high-octane premium gasoline has nearly breached the P50 per liter level.