Oil firms told: Display weekly price adjustments

Published June 18, 2019, 12:00 AM

by manilabulletin_admin

By Myrna M. Velasco

The country’s oil companies as well as their dealers will be required to display all price adjustments’ information – not just the total price per product – in their stations on a weekly basis.

According to Energy Assistant Director Rodela I. Romero, the display information will be done in all the more than 8,600 gasoline stations nationwide and such shall be updated on a weekly basis as the price moves at the pumps.

She added that the price adjustment per product shall be prominently displayed at the gasoline stations so consumers can be apprised how costs had moved in a particular outlet – and on DOE’s presumption, that can help an end-user decide or make a choice which oil company or dealer to patronize.

With the price adjustment boards, the energy department indicated that consumers would be able to see variations in cost movements being enforced at gasoline station-levels, which may be disparate from the uniform price movements often announced via the media.

Romero further explained that such has been part of the mandate under the Department of Energy (DOE) Circular that was issued recently prescribing the unbundling of cost components of petroleum products being brought into the country and subsequently retailed to consumers at the pumps.

In the various cost components that the department had directed the oil firms to unbundle or itemize though, industry players are up in arms on some that could unlawfully expose trade secret or violate prudent industry practices, hence, the Circular is anticipated to be facing eventual tough legal battle.

The DOE has also been requiring the oil firms to reveal their “profit margin” in their document-submissions, but when the DOE was quizzed if there’s a limit to profit that the industry players could have, the forthright answer of the department was: “none, because it’s a deregulated industry.”

Romero added the overall target of the Circular is just to invoke higher degree of transparency on product pricing, hence, the requirement of regular updates on price display boards at stations.

Essentially, that will only be the part of the mandate that will be known by the public; while most of the four-tiered price elements that will be submitted to the DOE shall be kept confidential.

Such cost elements will be the international content which will include the import cost of crude and finished petroleum products as well as freight cost; the second component on taxes and duties; the price relating to biofuels blend; and then the ‘oil company take’ or profit margin.

In this edict, the DOE is gaining support from advocacy group like Laban Konsyumer Inc. (LKI), with it asserting that “it is a good start and good news for all consumers.”

LKI President Victorio Dimagiba said his group is awaiting the implementation of the DOE Circular as this “will allow consumers to understand why oil price adjustments weekly are the same amount for gasoline, diesel and kerosene for all oil companies whether pure importers or those with refineries.”