Reader Calls For A Gas Strike

Another P2.10 per liter for gasoline is definitely alarming. But what can anyone other than OPEC heads of states do? Last Wednesday, the price of Dubai crude (our benchmark crude type) went up to $28.41 a barrel, up by $1.60 from Tuesday's price. In Bangkok, diesel is P3 a liter higher than Manila's price.

I heard some regional traders are talking about importing oil products from here because our prices are dirt cheap compared to prices in the region and the world. And they have done that before. In the process, they unfairly made local consumers subsidize the price of the products they imported, and bloated the OPSF deficit. Banning the exports of local oil products won't work. They will smuggle the products out of the country if the economic incentive is there.

What can we do? A reader suggests a gas strike. I recall that they had tried this in the US a few years ago to dramatize disgust over rising fuel prices. I'm sure no one had the illusion that it will have any positive short term effect, like lower prices. But it delivered a message everyone was dying to give but don't quite know how. A STAR reader, Roger Baldueza, has sent an e-mail to STAR columnists proposing we do just that on April 15.

"If the consumers don't act soon, the prices will keep on their steady incline," Baldueza warned. Here's how it works: "On April 15, 2000 no one will buy gas. If you are in desperate need of gas, purchase either the day before or the day after." Maybe the gasoline dealers, who are also suffering because of this price increases, can join the protest by closing down their stations. Reader Baldueza warns that if we don't do anything soon, "gas prices will climb to around Php.16.00-17.00/liter, by summertime."

I doubt if a one day gas boycott will bring down prices quickly, if at all. However, Baldueza is right about gasoline prices rising some more by summertime. The US government, according to The Washington Post, has warned American motorists to get used to escalating gasoline prices this summer.

Prices will rise, The Washington Post reported, even if the OPEC oil cartel decides to increase production in their meeting towards the end of this month. It will be too late to process the additional production in time for the American summer. Since their summer starts as our summer ends about June, there is more reason why those of us who plan to drive to resort destinations next month must factor higher fuel cost.

And can anyone imagine how bad prices will be if OPEC decides not to do anything? Right now, the world is consuming two million barrels more than it is producing. Of course prices will go up. But Iran, Libya and Algeria, who are price hawks within OPEC, are saying that there isn't any need to do anything because the world is not facing a supply shortage. That means ever escalating prices.

A one day oil boycott will be an inconvenience to consumers and may cause some disruptions in oil company operations. If it can be done in a way that the world's consumers show some solidarity, it might even deliver a strong message to the OPEC members. The more important thing about this is, it will show a willingness on the part of consumers to suffer a little in the hope of getting some relief from the cartel. At the very least, it will release some amount of frustration building up inside of us.

But it will also show how helpless we all are to resort to this largely futile but symbolic gesture. A spokesman of the mad bombers of the DOE building at Bonifacio said they did it to show disgust over the inability of government to offer any alternative to the rising fuel prices. He added that is why they are supporting the oil exchange proposal, in the absence of anything else.

I see two things the government can do. In the short term, government should consider a temporary cut in specific taxes for gasoline and diesel. For premium leaded gasoline, specific tax is P5.35 a liter, P4.35 a liter for unleaded and for diesel, it is P1.60.

I realize this will worsen the budget deficit, but this is an emergency. Congress should quickly pass the enabling legislation cutting specific taxes on gasoline and diesel, if not outright removing it for a period of say, six months.

Anyway, the higher crude prices mean Customs will collect more duties since import duties are ad valorem in nature. Ka-partner ng OPEC ang Customs, in effect. They can also collect the capital gains tax liability of Dante Tan for all those over the counter trades on BW.

I doubt if there is anything else we can do in the short term that will be effective and will produce the desired result quickly other than a gasoline tax cut. For the long term, we should launch programs to increase our efficiency in our use of energy resources. We can use better equipment, improve maintenance of existing equipment (including cars) and start a conscious energy conservation program.

Using energy more efficiently is also good for our foreign reserves, since we import over half of our energy needs. This is also good for our environment since better maintained car engines and other equipment give out less of the damaging pollutive gases. All this pollution we see from the tailpipes of vehicles and smokestacks of industries are partly burned fuel resulting from incomplete combustion.

One thing is certain. We can't go on with business as usual. We should be on crisis mode again, on energy crisis mode. Government should actively campaign for energy conservation as a response to an energy cost crisis. We are at the mercy of the OPEC members on the matter of price. But the world can work together to drastically cut demand.

Maybe embattled SEC Chief Jun Yasay really didn't know Bubby Dacer (Dante Tan's PR consultant) was going to be at FilEstate's Boracay golf course. I think Mr. Yasay's bigger indiscretion was accepting FilEstate's invitation to be there.

SEC is the regulator of College Assurance Plan (CAP) which is related to FilEstate. In fact there were questions raised on whether CAP's investment in FilEstate is prudent, or if CAP invested at FilEstate at all. SEC is supposed to judge the propriety of such an investment.

Yasay could have postponed the golfing trip until March 26. That isn't such a long wait.

Reader Chito Santos forwarded today's joke by e-mail.

Frank came into his wife's room one day. "If I were, say, disfigured, would you still love me?" he asked her.

"Darling, I'll always love you," she said calmly, filing her nails.

"How about if I became crippled and couldn't make love to you any more?" he asked nervously.

"Don't worry, darling, I'll always love you," she told him, buffing her nails.

"Well, how about if I lost my job as vice president?" Frank went on, "if I weren't pulling in six figures any more. Would you still love me then?"

The woman looked over at her husband's worried face. "Frank, I'll always love you," she reassured him, "but most of all, I'll really miss you."

(Boo Chanco's e-mail address is [email protected])