Small oil players refute Concepcion on price hike

The Independent Philippine Petroleum Corporations Association (IPPCA) refuted yesterday Consumer Oil and Price Watch (COPW) chairman Raul T. Concepcion’s statement that there will be no price increases until next month.

"Press statements recently released by COPW regarding expected oil price movements in the months of July and August are clearly misleading," IPPCA executive director Hector Fajardo said.

Fajardo added that " by setting false expectations, the COPW, with its irresponsible comments, puts the entire oil industry in a bad light and may cause unrest in consumers who expect no price movements during a time when upward price movements are sure to take place".

According to IPPCA data, oil companies still have under-recoveries of 78.3 centavos per liter for unleaded gasoline and P3.81 per liter for diesel as of July 27, 2004.

"There is no doubt that the COPW has good intentions in its role as public informer. However, good intentions coupled with short-term reference data can result in a mistaken understanding of where the market is headed," Fajardo said.

IPPCA chairman Fernando Martinez said they are, in fact, preparing to increase pump prices in the next few days by about 60 centavos per liter.

"Whether a tariff hike is implemented or not, a price hike of 60 to 70 centavos per liter is likely by the end of the week or up to the first week of August," Martinez said.

Dubai crude, used as benchmark in local pricing, has averaged $34.46 per barrel versus the June average of $33.43. The Mean of Platts Singapore (MOPS) for gasoline meanwhile, averaged $46.07 per barrel from the June average of $45.19 per barrel.

MOPS, on the other hand, is used as the basis of oil importers for pricing their products. MOPS for diesel reached $45.68 per barrel to date from $42.84 per barrel in June.

Concepcion said the oil firms have no basis in increasing prices of petroleum products.

The consumer advocate said the easing of oil prices in June versus May should have resulted to a P1.50 per liter rollback for gasoline and 57 centavos per liter for diesel.

"The amount should be used to offset any price increase in July," the COPW chairman said.