DOE welcomes initiative of Eastern Petroleum

The initiative of new oil player Eastern Petroleum Corp.(EPC) to provide pricing incentive to the transport sector is a welcome development, the Department of Energy (DOE) said yesterday.

In a supply agreement signed recently, EPC agreed to provide members of the transport group Pasang Masda National Inc. a 60-centavo per liter discount on fuel purchases along the routes of Mandaluyong and Pantranco in Quezon City.

The signing of the agreement was witnessed by the DOE and the Land Transportation Franchising and Regulatory Board (LTFRB). This is an offshoot of the discussions between the government and the oil companies to help cushion the impact of rising oil prices on the transport sector.

"We are hoping that other oil companies will follow the lead of Eastern Petroleum in providing discount to the public transport sector," Energy Secretary Vincent S. Perez said.

The DOE is looking for transport terminals where oil firms can put up filling stations and provide similar discounts to jeepney drivers. At present, the DOE has identified the following areas as site for filling stations – Makati, Malabon and Novaliches.

The DOE is also encouraging other transport sector to band together to form associations for them to be able to buy collectively, giving them enough leverage to bargain for volume discounts.

The price of crude is expected to average about $30 per barrel in the first quarter as a result of the ongoing tension in the Middle East and tight supply situation in the world market. This, however, is seen to significantly drop to $24 per barrel by the second quarter and eventually settle at an average of $26.41 per barrel for the entire year.

"Price adjustment is inevitable in response to different events. We cannot stop it but we could help temper these adjustments," Perez said.

The energy chief advised consumers to be more vigilant and to exercise their power of choice. He pointed out that there are oil companies that have not adjusted prices of fuel.

He said the DOE will continue to closely monitor the developments in the world market and provide updates to consumers on the prevailing prices of oil in the local market. – Donnabelle Gatdula