Euan Paulo C. Añonuevo
Manila Times

The government has organized a taskforce that will monitor oil firms’ price adjustments in light of the soaring price of crude in the world market.

In a statement, the Department of Energy said the government formed the task force that also includes the Department of Justice “to take a very active role” in assessing and evaluating all factors to ensure fair and reasonable pricing of petroleum products as mandated under Republic Act No. 8479 or the Downstream Oil Deregulation Law.

Under a memorandum of agreement signed by the two government agencies on Monday, the task force shall investigate “any person, any threatened, imminent or actual cartelization or predatory pricing, the commission of any violation under Section 12 of the Act or any unreasonable rise in the price of a petroleum product.”

Undersecretaries from both departments will serve as co-chairmen of the task force.

In an earlier study, the University of Asia and the Pacific and the SyCip Gorres Velayo and Co. accounting firm cleared oil firms of any irregularities in previous price increases at the pump. The Energy department commissioned the study last year, the results of which were released in March.

Since the start of the year, local oil companies have jacked up prices 19 times to recover their “losses” after crude soared to record levels.

A number of groups have scored the increases saying that current fuel prices, which are almost double last year’s, are more than what they should be.

Energy Secretary Angelo Reyes earlier said the department will keep a close eye on fuel adjustments, including rollbacks, to ensure that market forces are solely responsible for such moves.

“We will see to it that oil companies do not unreasonably price their products,” he said.

Local retailers surprised motorists last week when they announced a price rollback within days of oil hitting a fresh record high in the world market.

Flying V, a member of the Independent Philippine Petroleum Companies Association (IPPCA), triggered the industry-wide rollback in gasoline prices. The company’s move caught fellow IPPCA members as well as the Big Three—Petron, Shell and Caltex—by surprise, forcing many of them to respond with their own price reductions.

The industry’s price adjustment last week was a turnaround from the past practice of immediately raising pump prices whenever crude hits a new record high in the world market.

Before the rollback, industry players had claimed they still had about P6 in under-recoveries. In announcing its reduction, Flying V however said that it managed to earn modest margins on its sales, thus its decision to cut prices.