Petron cuts exports to help stabilize domestic oil supply

Publicly-listed Petron Corp. has committed to the government to lessen its fuel exports at least for the next few months until the international economic jitters brought about by the terrorists attacks on United States settle down.

Energy Secretary Vincent S. Perez said the commitment was made after he requested the oil firm to study its export business amidst the uncertainty in the international crude market.

"I requested Petron to lessen its exports in view of the potential shortage on oil supply," Perez said, while declining to disclose how much of Petron’s overall capacity will not be exported for the meantime.

Petron corporate communications manager Virginia Ruivivar, on the other hand, said that they have recently been "cautious" in dealing with their export business. "In fact, Petron has not been exporting fuel oil (diesel, kerosene, gasoline) lately because the prices are not good," Ruivivar said.

Ruivivar said it has been the strategy of the firm to stay away from the export business if it is not necessary. "For our part, if the price in the (export) market is not encouraging, we are limiting out sales abroad," she said.

According to the Petron official, they have already assured the government that the company will have sufficient oil supply cover. "From our end, we can assure the public of stable and reliable supply despite the ongoing US crisis," she added.

Before the US attack, it has been Petron’s strategy to look to the export market for added volumes as their domestic sales declined.

Last year, the company had decided to double its exportss from 4.5 million barrels to more than nine barrels. "This strategy minimized the decline in our overall sales to just over one percent," Petron president Motassim Al Ma-ashouq said, during the company’s stockholder’s meeting a few months ago.

In May this year, Petron said it planning to increase the running capacity of its Bataan-based refinery to 90 percent or 160,000 barrels of oil per day (BOPD) from the present 130,000 BOPD to support plans to expand its market.

For the first three months of the year, the company’s export sales grew by 21.1 percent (from 2.1 million barrels to 2.6 million barrels) of its total sales. Historically, export sales account to only 10 percent.

As of end-December 2000, 17.7 percent of its total sales volume account for export, compared to 8.5 percent in 1999.