By Myrna M. Velasco
With the perception that the “margins” of the oil companies have been the industry’s biggest “trade secret,” the Department of Energy (DOE) indicated that it will be exploring legal means that could compel the players to be transparent on the building blocks of their profits.
Energy Secretary Alfonso G. Cusi told reporters that “we have difficulty unraveling industry take, they (oil companies) don’t want to reveal it.”
The energy department has been pushing for an unbundling policy of all the cost components being passed on to consumers via pump prices – but this is being objected to by the oil firms.
Cusi admitted that until now, the department wasn’t able to vet into an acceptable legal fix yet that will enable the oil companies to fully disclose their profitability levels.
“This time, we don’t have a solid legal ground yet to let them reveal that ‘trade secret,’ a legal fix in which the oil companies can’t sue me,” he stressed.
The DOE is laying down the parallelism that the deregulated downstream oil industry has with that of the power sector – which is in the same facet of deregulation, but the latter is fully transparent on pricing, building blocks on profits and even the basis of pricing their power capacity.
Cusi lamented that when the oil firms report on their top and bottom lines, these are always set in percentage and just the final numbers – but they never itemized what particular costs goes to what components.
He thus averred that if the oil companies won’t cooperate on fully disclosing all their numbers, the proposed unbundling policy on pump prices will never end up an explicit and effective reference for consumers.
“If we would not be able to know their margins, then the cost unbundling policy will just be partial. What good will that do then?,” he asserted.
The energy department is scheduling another round of public consultation this week on the planned cost itemization of the oil firm’s pricing elements – a wider forum in which the position of various stakeholders will be heard and weighed in the crafting of the propounded cost unbundling edict.
Cusi qualified that they are aware of the sentiment that the industry is deregulated, but this shouldn’t stop the government from making the players be transparent and accountable to the consuming public that they serve.