Oil price hike: Beyond our control

With wealthy candidates continuously pouring billions into their campaign coffers and supporters wildly spending bundles of bills in their sorties, we can expect inflation to cut in right after the last ballot is cast in this election. Expect, therefore, that all basic commodities shall wear new price tags, or aptly, higher price tags. Aggravated by El Niño, prices of basic commodities, as essential as rice, shall surely soar. However, the government’s quick fix approaches like subsidizing imports of this “soon-to-rot” staple from the neighboring rice exporting countries might temporarily cushion the potential sharp increase. Needless to say, that is just temporary and will never solve permanently any wild-swinging pricing woes brought about by of our deep-seated inadequacies.

Naively, if we only worry about the staple, then, we simply have ourselves to blame. The fact is, another grave inadequacy has been lurking not just before us now but even in our forefathers’ time. That’s the very basic need for oil. Except for a few drops from the Palawan oil rigs, we are practically importing every liter of it. 

Today, this problem is not as pronounced as it should be. This is because we simply make oil prices as the main barometer for us to either be complacent or go panicking.   Probably, because prices are still bearable, then, we don’t dread. 

Unfortunately, this seeming complacency will never last. All of us will soon fret on our pants when government’s price cushioning options will run out. All these imports (rice and oil) are still enjoying a stronger peso, therefore, prices are still bearable. While our currency’s strength isn’t artificial, it is brought about by the increasing remittances of our OFWs coupled with the issuances of the dollar denominated bonds early this year and in this month of April. Also, the compelling softness of the US dollar against other currencies has unnecessarily contributed to that temporary relief. Obviously, therefore, we are overflowing with dollars and Euros this time of the year and at the same time are momentarily enjoying a very passive US dollar.

However, the government cannot go on and on selling bonds like barbecue or hot cake. That will soon stop and the inflow of foreign currencies will soon slow down. Worst, based on all economic indicators, the US economy is set to rebound and, therefore, the dollar’s strength will soon be felt. 

Obviously, therefore, as jobs and other US economic indicators turn brighter day by day, consumer spending will again shoot up. As more than two-thirds of the US economy is consumer spending driven, it shall consequently leap and the demand for oil will certainly increase. Logically, oil prices will again shoot up, and we, as an oil importing country will again be in the receiving end of the bargain. Coupled with higher consumption in diesel fuel to power second hand generator sets (to cover energy supply deficit), the problems could be worst.

Consequently, demands for raises in pays from the labor sector shall mount and the economy shall again experience tremors flowing through its veins.   Therefore, few months or weeks from now, if not attended to, the country will usher in another distasteful sight that may be viewed before a nationwide audience - the left-leaning organizations’ way of solving problems. As usual, on primetime, we could be witnesses of these thugs’ hooliganism and their penchant of destroying others’ legitimately built properties, more particularly, those owned by giant oil retailers. Condemning them no end and tagging them as the ruthless perpetrators of all our miseries. 

Apparently infiltrated by ideologues, jeepney operators’ and drivers organizations will certainly join the call. They will again stop plying their routes to the inconvenience of the general public.

Obviously, they will use their (ideologues) mastery of blowing peoples’ pent-up sentiment into wild and uncontrollable emotions. Though hollow to most of us, their misinformed flock will surely take their rhetoric as gospel truth. All these misguided statements and seemingly libelous invectives stemming from a singular root of perceived and felt miseries - the inevitable increase in oil prices. As usual, with the hope of gaining immense popularity, these left-leaning cause-oriented groups will try to make it a political issue. 

Frustratingly, this has always been the vicious cycle. A problem exists, we go for temporary solutions. When the temporary solutions run out, rallies and demonstrations perpetrated by cause –oriented groups ensue. Then, defeated politicians take their turns lambasting the incumbents’ inefficiencies. Then, promises to do differently if given the opportunity to serve. Again, this oft-repeated rhetoric had been preached countless of times but has, so far, delivered no concrete results.

Honestly, nobody will wish for it (oil price hike), not even the country’s giant retailers since high prices will require more capital. Unfortunately, like an amputee’s ubiquitous cane, it will be a permanent fixture in our daily routine. It is simply unavoidable. While its truest impact isn’t fully felt with a seemingly stronger peso, very soon it might slowly sap whatever is left in one’s pocket if our currency shall slowly slide beyond P47.00 to a US dollar.

Therefore, it is about time that our leaders shall emulate US President Obama. For one, it is noteworthy that in the US (the world’s biggest oil importing country), in preparing for the consequences of the demand surge, President Obama (despite his strong opposition of oil drilling in his 2008 campaign trail) has emphatically announced his plans to “reverse a decades-old U.S. ban on new drilling for oil and natural gas off some parts of the country's shores”.  The reversal would permit new drilling in the Atlantic Ocean off the southern United States, in the eastern Gulf of Mexico, and near part of Alaska.

Doing this despite opposition from fellow democrats (who helped him take the White House) gives anyone an idea on how should a president exhibits genuine care for his people. Simply put, in order to sustain the modest growth his country so far attained, he made sure that whatever necessities the economy needs he was ready to provide even it means swallowing his own pride.

Fortunately, just like in the USA, we can also cushion the impact because we also have our own oil deposits to explore. Sadly, however, unlike Pres. Obama, our leaders shiver in the thought that their decisions might be so unpopular. They tremble in the idea that they might loss their elective seats (a.k.a. livelihood) if they go against the will of the noisy, but not necessarily big, organized and sincere entities.   

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