Leading industry player Petron Corporation has ramped up outputs at its two refineries in the Philippine and Malaysian markets to sustain sales volume that have been propping up targeted profitability levels.

During the company’s annual stockholders’ meeting, Petron Chief Finance Officer Emmanuel E. Eraña indicated that “through carefully planned process enhancement, we scaled up our production at our refineries both in Bataan and Port Dickson – raising our combined crude run by 11% to maximize the company’s refining assets.”

He added that the company has been “consistently maximizing supply chain integrations and in 2023, improvements were focused on integrating basic hauling services and into-plane operations.”

Within this year, Petron General Manager and Director Lubin B. Nepomuceno emphasized that “the focus will be on increasing our sales volume and further improvement in financial performance.”

For that to be concretized, he specified that the oil firm is “taking advantage of the ongoing economic recovery,” and that has also been the anchor of the sales upturn logged by the company last year.

“We will continue that and hopefully, we might be able to sustain growth of our volumes and income performance,” he stressed.

With the company’s income escalation, Petron President and CEO Ramon S. Ang conveyed that corresponding cash dividends will be paid out to outstanding stockholders.

On questions about relatively higher pump prices in the country, Ang explained that the actual price of fuel if compared to the Malaysian market is just at the level of P20 per liter – but the other two-thirds in the cost pie are attributed to imposed taxes; as well as the absence of government subsidy in the case of the Philippine market.

He noted that in other ASEAN countries – primarily Indonesia, Malaysia, Vietnam and Thailand – their respective governments have been extending subsidies to fuel prices that are used both for the transport sector and even for electricity generation, hence, their prices tend to be lower.

For the Philippines, in particular, he qualified that aside from the fact that the oil industry is heavily taxed which has been adding up roughly P20 in the per-liter cost of oil; the absence of subsidy integrates additional P20 per liter in the overall prices reflected at the pumps.

“All other ASEAN countries – even for electricity rates in the Philippines, it’s usually three times compared to our regional countries – because our neighboring countries put in subsidy, that’s one third; and one-third actual cost and another one-third is the imposed taxes,” Ang said.

He pointed out that the leaning of the Philippines is for market forces to work, “unlike our neighboring countries, they are heavily subsidized, but I think our neighboring countries will not be able to sustain that in the long term.”