Fuel prices up by 40-50¢ per liter

The so-called "Big 3" oil companies announced yesterday an increase in fuel prices, rest assured that the Chief Executive won’t be breathing down their necks for it.

Petron Corp. and Caltex Philippines announced an increase averaging 40 to 50 centavos per liter effective yesterday while Pilipinas Shell Petroleum Corp. said it would increase its prices by a still unannounced amount by 6 a.m. today.

Aside from the Big 3, new industry player Total Petroleum also announced a price increase of its products, averaging 40 to 45 centavos per liter effective at 6 a.m. today.

The Big 3 oil firms announced the price increase a day after Mrs. Arroyo said she was not comfortable with the thought of begging multinational corporations for a stay in price increases, as was the wont of her disgraced predecessor.

Instead, the President delegated the responsibility to outgoing Energy Secretary Jose Isidro Camacho, who will shortly assume the finance portfolio vice Alberto Romulo, the executive secretary-designate.

But Camacho, whom the President publicly praised for the progress of the still-stalled Omnibus Power Sector Reform bill, dismissed the announced price hike as "inevitable."

"You can see already that crude oil has gone up last week to above $25 (per barrel). Today, I guess it’s gone up to $26.50 per barrel of Dubai Crude which we are using as a basis for our pricing," he said.

"I always follow the spirit of deregulation," Camacho said. "I only appeal to our oil companies to be sensitive to public interest."

Caltex, however, said it raised its premium brands by 49 centavos and diesel fuel by 44 centavos because Dubai crude increased by about 60 centavos per liter from February to April.

Petron also raised the price of premium gasoline by 49 centavos, diesel by 45 centavos and kerosene and regular gasoline by 42 centavos but froze the prices of liquefied petroleum gas (LPG) and industrial fuel oil (IFO).

While Dubai Crude dropped by 40 centavos in March, the benchmark price went up by 56 centavos in April and another 36 centavos in May, Caltex said.

Aside from the price of Dubai Crude, Caltex said the increase was also due to the depreciation of the peso against the dollar from P48.37 in March to P51.34 in April.

Last February, Caltex was the only oil company that raised its prices by five centavos but rolled them back two weeks later when other oil firms refused to follow suit.

Shell and Total earlier said they were not inclined to follow Caltex and Petron but announced their respective increases late yesterday.

New industry player Flying V, for its part, said they still have no plans of raising their prices.

"Unless prices of finished petroleum products increase substantially and the peso further weakens against the dollar, we might not have to do anything," said Flying V spokesman Macky Lopez.

Consumer and Oil Price Watch chairman Raul Concepcion said the oil firms are likely to increase their prices this month but stressed the increase should not be higher than 24 centavos.

For his part, Philippine Institute of Petroleum executive director Reynaldo Marquez said oil price increases should happen only after the election process is completed.

"It might be counter-productive to do anything right now," Marquez said.