The President said the first blow would come by revising the Oil Deregulation Law, which is currently under review by the Department of Energy and Congress.
"That is the important (provision) to review, the anti-cartel. The best thing to do is look at the cartel behavior and how we can stop (abuses)," she said during a pulong bayan or town hall meeting at the Farmers Market in Cubao, Quezon City.
Mrs. Arroyo made the statement as Sen. Mar Roxas, who was also at the meeting, told the audience how the government planned to address recent oil price hikes that have driven up prices of basic commodities as well as jeepney, bus and taxi fares.
Roxas said the President wants to have the Oil Deregulation Law revised to give the Department of Energy more power to monitor prices of fuel and petroleum products.
"What we can do is ensure that we are not being taken advantage of. That is what the President wants and that is why the oil deregulation law is being revised in the Senate and the House (of Representatives), to strengthen the anti-cartel, anti-monopoly and anti-price fixing provisions," he said.
Mrs. Arroyo said the executive branch and Congress would have to work together to find ways to lessen the impact of rising oil prices.
Roxas said the revision of the oil deregulation law and other measures were only some of the steps the government could take since oil prices on the world market were beyond the country’s control.
The President also disclosed some sectors had suggested the revival of the oil price stabilization fund (OPSF) to bring down oil prices, but Roxas thumbed down this proposal.
He said the money could be better spent on education, health, infrastructure and other basic services since the government cannot allocate enough money to subsidize the OPSF.
The OPSF was established during the world oil crisis in the late 1970s to early 1980s as a buffer fund to shield local oil prices from fluctuations.
Local oil companies contributed to the fund when world crude prices were low, and drew from the fund when crude prices rose, thus ensuring that local oil prices remained relatively stable.
However, the government had to partially subsidize the OPSF, resulting in a budgetary deficit.
Roxas said the Senate had started hearings on the Oil Deregulation Law.
Other lawmakers have urged the government to come up with an effective buffer against oil price hikes, which they described as part of "speculative and monopolistic practices" by the local oil firms.
Since the deregulation of the local oil industry, the government can only appeal to oil companies not to drastically increase their prices.
He encouraged the private sector to follow the government’s lead.
The President announced earlier that she would try to provide tax incentives to companies that give their employees transportation allowance.
She also asked Energy Secretary Raphael Lotilla to make daily visits to gasoline stations that offer discounts to their customers, especially jeepney drivers.
Mrs. Arroyo said she called for a special National Economic Development Authority Cabinet meeting to tackle the recent oil price hikes.
The government has also implemented energy conservation measures like the four-day workweek scheme in order to reduce oil consumption.
The President assured that her administration would try to cushion the impact of the rising oil prices by stabilizing the prices of basic commodities, particularly rice.
As for the government’s move to sell off its 4.9-percent share in the $4.5-billion project to tap natural gas reserves in Malampaya, northern Palawan, Press Secretary Ignacio Bunye said the project "is a leading economic factor that will continue to boost our goal of reducing the country’s dependence on imported oil."
The Philippine National Oil Co.-Exploration Corp. holds 10 percent participating interest in the Malampaya project. The PNOC-EC said its partners in the project would match the terms offered by a consortium led by LG International Corp. of Korea.
The PNOC-EC’s project partners are Chevron Texaco Malampaya LLC, Shell Philippines LLC and SPEX.
"The close competition in the bid for the government’s share in the project is a sign of solid investor interest in the Philippine energy sector, which will continue to stabilize the economy and create more jobs for Filipinos," Bunye said.
Late last month, the government’s committee on privatization approved the sale of 4.9 percent of the PNOC-EC’s participating interest to LG International’s consortium, which is composed of Korea Gas Corp. Seoul City Gas Co. and Dae Sung International.
However, the period in which the Malampaya group can challenge the Korean consortium’s offer lapsed April 7. PNOC president Eduardo Mañalac did not disclose the financial details of the sale, but said "We’re not willing to sell it at less than $101 million."
The government is selling the stake to raise funds to help reduce its $3.6-billion annual budget deficit.
The Malampaya natural gas reserves can yield three trillion cubic feet of gas that can be used to generate up to 3,000 megawatts of electricity for 20 years — more than half of the electricity requirements of Luzon even during peak hours.