Palace moves amid oil crisis

Rody eyes Congress special session to amend Oil Deregulation Law

The Palace on Tuesday said it is time to call Congress to an emergency session to look at amending the oil deregulation law, as President Rodrigo Duterte met his Cabinet last night on the issue following the sharp increases in the prices of fuel, aggravated by the Russian invasion of Ukraine.

PEDAL POWER. A family riding on a tricycle passes protesters holding placards as they stage a rally in front of a gas station in Manila on March 15. AFP

Earlier in the day, Acting Cabinet Secretary Melvin Matibag said the President would meet his Cabinet members to decide on the oil subsidy for the public transport sector.

“The President mentioned that they might call for an emergency session for Congress.

There should be some legislation to address this looming problem,” Matibag added.

Earlier, Duterte said a special session may be needed to discuss the recommendations of the National Economic and Development Authority todeal with the economic impact on Russia’s war against Ukraine.

ADVERTISEMENT

“I think, even if this stops, the fractured economy in Europe would affect us more or less by next year,” the President said.

Lawmakers backed the call for a special session of Congress to tackle a possible declaration of a state of economic emergency.

Under the law, formally known as the Downstream Industry Deregulation Act, government control was removed to help oil companies become more competitive with their supply and pricing of petroleum products.

Senator Sherwin Gatchalian lauded the quick efforts of the House to amend the Downstream Oil Deregulation law to improve transparency and shield consumers from supply shocks.

“These are long term solutions that will benefit our people,” he said.

However, Gatchalian said the fundamental problem still remains—the Philippines imports 100 percent of its fuel requirement, making it very susceptible to global price shocks.

“We need to reduce our dependence on imported oil by aggressively exploring for new oil and gas reserves as well as transitioning to electric vehicles,” he said.

“We also need to immediately distribute the Pantawid Pasada to the 337,443 PUV drivers, tricycle drivers, and delivery providers to give them immediate reprieve from high oil prices,” Gatchalian said.

In the House, the committee on energy chaired by Pampanga Rep. Juan Miguel Arroyo approved amendments to the law in an online meeting, saying they hoped it would help cushion the impact of rising fuel prices.

“Unbundling the retail price of domestic petroleum product does not run counter to the principle of deregulation, and is, in fact, a tool to ensure its effectivity,” Marikina City Rep. Stella Luz Quimbo, one of the bill’s authors, said during the meeting.

“Thus, the DOE (Department of Energy) must be mandated and capacitated to monitor the unbundled retail prices,” she added.

Among the proposed amendments is to “institutionalize the minimum inventory requirements for petroleum products for purposes of supply security and unbundling the cost of petroleum.

House Deputy Minority leader and Bayan Muna Rep. Carlos Isagani Zarate lauded the passage of the bill amending the Oil Regulation Law by raising the country’s oil stock requirement and enforcing the unbundling of oil prices.

“This is an initial step in the right direction so that we may at least see the true price of oil and not be hidden by the oil companies,” said Zarate, who supports the repeal of the law, which he said was a dismal failure in keeping the price of petroleum products down.

Zarate also welcomed the prospect of a special session of Congress to pass needed measures, such as the suspension of excise taxes on fuel products.

Deputy Majority Leader and Quezon City Rep. Precious Hipolito Castelo urged the President to suspend the excise tax on fuel.

“The temporary suspension of oil taxes will provide our people instant relief from soaring fuel prices. It will benefit all sectors,” Castelo said.

She said pump prices of oil products could go down by the amount of excise taxes whose collection would be temporarily shelved.

“This means that prices could decrease by P10 per liter for gasoline, P6 per liter for diesel and P3 per kilogram for liquefied petroleum gas or P33 per 11-kilogram cylinder,” she said.

The reduction in the cost of fuel would have a similar domino effect on prices of goods and services, Castelo added.

The Department of Finance (DOF) is opposed to the proposed suspension of fuel taxes, which it said would cost the government P138 billion a year in lost revenue.

Castelo said she would support a proposal for an automatic taxn suspension mechanism whenever the cost of crude oil in the world market breaches $80 per barrel.

Please enable JavaScript to view the comments powered by Disqus.

*****
Credit belongs to : www.manilastandard.net

Check Also

Kadiwa stores open beyond X’mas to help stabilize prices

Kadiwa pop-up markets will continue beyond Christmas until the country gets to a point when …