P1.60 per liter overpricing in September:
Oil Firms Continue to
Profit in spite of Rollbacks
Government and the
oil companies are using the series of oil price rollbacks to justify the
deregulation policy and make it appear that the fundamentals of free
market competition are working. However, the continued overpricing and
profiteering of the oil firms amid easing global oil prices show that
deregulation only exposed the Filipino consumers to more abuse.
BY IBON FOUNDATION
Posted by
Bulatlat
Oil companies continued to amass billions
of pesos in profiteering in spite of the string of rollbacks they
implemented in September.
The ideal pump price reduction last month
was P3.55 per liter but the oil firms implemented a total drop of only
P1.95 for a net overpricing of P1.60. This translated to extra profits of
around P2.47 billion for September alone.
Dubai crude posted a significant decline
in price from $68.77 a barrel in August to $59.82 last month while the
peso continued to rally against the US dollar from P51.33 to P50.36 during
the same period.
The September overpricing brought the net
overpricing for 2006 at P3.72 per liter. Meanwhile, cumulative
profiteering from January to September is estimated at P5.81 billion. Of
this amount, Petron took around P2.22 billion; Shell, P1.87 billion;
Chevron, P917.55 billion; and the new players, P805.47 billion. (See
Table)
|
Table.
Summary of oil overpricing
2006 |
|
Month |
Dubai crude ($ per bbl) |
Forex (P per dollar) |
Adjustments (P per liter) |
Overpricing
(P per liter) |
Profiteering
(P million) |
|
Ideal |
Actual |
|
January |
58.44 |
52.58 |
1.54 |
1.00 |
-0.54 |
-866.81 |
|
February |
57.61 |
51.79 |
-0.63 |
-0.49 |
0.14 |
202.35 |
|
March |
57.82 |
51.19 |
-0.18 |
0.15 |
0.33 |
520.09 |
|
April |
64.14 |
51.38 |
2.36 |
2.00 |
-0.36 |
-559.13 |
|
May |
65.00 |
52.16 |
0.68 |
1.50 |
0.82 |
1,312.64 |
|
June |
65.22 |
53.18 |
0.56 |
1.24 |
0.68 |
1,047.33 |
|
July |
69.17 |
52.30 |
0.98 |
0.93 |
-0.05 |
-82.86 |
|
August |
68.77 |
51.33 |
-0.63 |
0.48 |
1.11 |
1,767.08 |
|
September |
59.82 |
50.36 |
-3.55 |
-1.95 |
1.60 |
2,466.58 |
|
October |
- |
- |
- |
- |
- |
- |
|
November |
- |
- |
- |
- |
- |
- |
|
December |
- |
- |
- |
- |
- |
- |
|
Total |
1.13 |
4.86 |
3.73 |
5,807.27 |
|
IBON
estimates based on DOE data |
Government and the oil companies are
using the series of oil price rollbacks to justify the deregulation policy
and make it appear that the fundamentals of free market competition are
working. However, the continued overpricing and profiteering of the oil
firms amid easing global oil prices show that deregulation only exposed
the Filipino consumers to more abuse. There is no other recourse today but
to repeal Republic Act No. 8479 or the Downstream Oil Industry
Deregulation Act of 1998 and initiate important reforms, including price
control, in the oil industry. Posted by Bulatlat
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