Oil firms hike prices

Two local oil companies raised prices of their petroleum products by an average of 57 centavos per liter starting last midnight, triggering protests from militant labor groups.

Caltex Philippines Inc. jacked up its prices by an ave-rage of 50 centavos per liter, while new player Total Petroleum Philippines Corp. increased its prices by an average of 65 centavos per liter.

Caltex said it will now sell its premium unleaded gasoline at P14.92 a liter from P14.42; regular gasoline, P13.17 from P12.67; diesel, P10.39 from P9.89; and kerosene, P9.77 from P 9.27.

Its prices for liquefied petroleum gas (LPG), aviation fuel and fuel oil remain unchanged.

Total, which has 11 service stations mostly in Metro Manila, said it will sell diesel at P10.50 a liter, premium gasoline at P15 and unleaded gasoline at P14.60.

Pilipinas Shell Petroleum Corp. and Petron Corp. have not yet raised their prices, but are expected to follow suit within the next two days. Other players such as Unioil, Triple A, Sea Oil and Eastern Petroleum may also raise prices.

In explaining their price increases, Caltex president Enrico Cavestany said, "We waited long enough before we implemented these price adjustments."

"After the partial increase in November to recover the September losses, we have not made any increases since then. We were under great economic pressure due to mounting losses to raise prices by December, but we had also decided to postpone such a move," Cavestany said in a statement.

Industry sources said that losses incurred by the three major oil companies have reached a total average of P1.38 a liter since the September adjustment.

During that month, the so-called landed cost of oil rose by 80 centavos a liter, but local oil firms adjusted their prices by only 42 centavos a liter following a plea by President Estrada for them to temper such hikes.

Total said in a statement that it has already incurred losses of up to P96 million from January to October last year.

"For the whole of 1999, these losses had ballooned to P140 million, displaying an abnormally rapid rate of loss of P44 million in November in December. No business can survive such hemorrhaging," it said.

"Our survival is at stake. And (we)... as a business organization, (have) chosen to stay alive with this price increase," it added.

A source said Shell's and Petron's price adjustment will not be that far from Caltex's.

"Increasing prices too high over that of Caltex will make them uncompetitive. Pricing it too low would make it uneconomical," the source said.

Meanwhile, labor groups said they will press for an across-the-board legislated wage hike following the local oil companies' decision to raise prices.

"Some people really know how to rub salt into the wound," the moderate Trade Union Congress of the Philippines (TUCP) said in a statement.

It said the latest price adjustment has provoked organized labor to resort to protest actions.

"Caltex, which will be shortly followed by the two members of the oil cartel, seems not to realize the ill-effects of their insatiable desire for profits on the lives of ordinary Filipinos," it said.

"As it is, workers are barely able to cope with prices of commodities and services. With this hike, prices will again shoot up to new heights," the TUCP added. --