Energy summit a ‘futile exercise’ Dona Pazzibugan Jerome Aning TJ Burgonio Philippine Daily Inquirer
January 06, 2008
MANILA, Philippines -- An opposition senator and militant groups on Saturday dismissed as a “futile exercise” and “a waste of energy” the top-level energy summit called by President Macapagal-Arroyo in the face of skyrocketing oil prices in the world market.
“The summit will not accomplish anything other than to highlight the ignorance and incompetence of energy officials who need to call a summit just to find out what’s going on,” said Sen. Francis Escudero.
Rather than hold a summit, he urged the government to map out mitigating measures to avert an oil crisis.
These measures, Escudero said, should include Sen. Manuel Roxas II’s proposal to suspend the imposition of the 12-percent expanded value-added tax on oil and other fuel products.
Even before world oil prices breached the $100 per barrel mark, Roxas had proposed the suspension of the VAT on oil products for six months to ease the impact of the surging oil prices.
But Roxas’ proposal would require an amendment to the VAT law and would cost the government about P15 billion in foregone revenues for six months.
“We must review the oil deregulation law and study the following: Removing the VAT, lowering tariffs, reimposing price ceilings and prohibiting price manipulation,” Escudero said.
He said the Department of Energy should also intensify its research and development efforts to find alternative and indigenous sources of energy.
Militant groups also shared Escudero’s view that Malacańang’s energy summit could turn out to be waste of energy.
The umbrella group Bagong Alyansang Makabayan expressed doubts the summit would be effective, since it was not keen on resolving the basic issue of high oil prices.
Bayan said that with the price of oil breaching the $100 mark, there was a need to immediately repeal the Oil Deregulation Law “to protect the people and the economy” from unwarranted increases in domestic prices of petroleum products.
In a statement, Bayan secretary general Renato Reyes Jr. said the demands of the people were “simple”: Stop oil price hikes by repealing the Oil Deregulation Law and scrap the 12-percent VAT imposed on petroleum products.
“Unless the so-called energy summit addresses these issues, can we really expect anything from this summit? The organizers will simply be wasting their energy,” Reyes said.
The militant peasants’ group Kilusang Magbubukid ng Pilipinas yesterday said there was no need for the government to hold an energy summit.
“There is no need for it because the answer is very obvious. All we have to do is again regulate oil prices and nationalize the oil industry,’’ KMP chair Rafael Mariano said.
Meanwhile, the Bayan-affiliated jeepney transport group Pagkakaisa ng mga Samahan ng Tsuper at Opereytor Nationwide (Piston) insisted there was no basis for a new local oil price hike.
Piston secretary general George San Mateo said that local oil companies could not use the recent oil price spike in the New York Mercantile Index to justify another local price increase since the Philippines did not rely on the index as the basis for adjusting local oil prices.
But an official of the Department of Energy allayed public fears of a fresh round of oil prices in view of the rise in world oil prices.
“The oil that we’re buying isn’t pegged at $100 per barrel. There’s no reason for us to panic. Our price basis, while high, is much much lower by about $10 per barrel,’’ Zenaida Monsada, director of the DOE’s oil industry management bureau, told a press forum in Quezon City.
The $100 per barrel was the price of a raw material for oil, and hence, could not be used as a basis by local oil companies to increase local prices, she said.
“If ever, this has to be transported to the Philippines and processed before it’s sold. That’s why it can’t be used as a basis by local oil companies to raise prices,’’ she said.
