Why are PH’s oil prices higher than its neighbors? DOE’s Garin explains

Energy Secretary Sharon Garin on Tuesday explained why the Philippines is the worst-hit country in Southeast Asia in terms of rising fuel prices due to the Middle East crisis.

At a virtual press briefing, Garin said that many of the country’s peers in the region are subsidizing the retail cost of petroleum.

“Ibig sabihin… Parang subsidized lang ‘yung presyo. ‘Pag bumibili ka sa gas station, may binabayaran ang gobyerno diyan para hindi napakataas ‘yung presyo,” the Energy Secretary said.

(It means, the price is subsidized. When you buy at a gas station, the government pays so that the prices won’t go too up.)

For this week, the DOE announced that pump prices of gasoline climbed by P8 to P12 per liter, bringing the retail prices for RON97 at P87.69 to P112.40 per liter, RON 95 at P83.10 to P109.78 per liter, and RON 91 at P82.60 to P102.50 per liter.

For diesel, the price increase stood at P15 to P18 per liter, bringing its pump price range at P107 to P134.30, while diesel plus price ranges at P114.99 to P144.20 per liter.

Kerosene, on the other hand, went up by P12 to P22 per liter, bringing its pump price range at P111.99 to P165.79 per liter.

Garin said the Philippines has no indigenous source and that “we import 99% of our petroleum.”

She added that the country’s downstream oil industry is deregulated, thus the government’s hands are tied as far as controlling pump prices are concerned.

“This is an unregulated industry… So we leave it to the [companies] to determine the price… The government does not dictate the price. So it is competition among the companies that determines the movement of prices,” she said.

READ: What is the Oil Deregulation Law?

The Energy Secretary also cited other factors such as the collection of excise and value-added tax (VAT) on fuel.

“There are reforms, substantial long-term reforms that we need to do in the oil industry. But right now, this is what we have. There needs to be legislative action if we want more control over the price,” Garin added. — JMA, GMA Integrated News