The inquiry was done in response to Resolution No. 2 s. 2015 of Ormoc Chamber of Commerce and Industry urging the SP to look into the disparity of local fuel prices to that of other places. The price difference reaches as high as P3-5, the resolution notes. Fuel prices per liter in Ormoc last Jan. 8 were pegged at P33.99 for diesel and P45.49 for premium compared to P32.75 and P41.15, respectively in Tacloban.
Operators of gas stations gave their observations. For Luzaleo Papellero, operator of OEL in Brgy. Curva, a price war is at play in other places because of the presence of small players like him. Small gas stations in Ormoc include OEL, Filoil and Star Oil. With two more small stations set to open, he is hopeful that a price war will also happen in Ormoc for the benefit of consumers.
Ferdinand G. Sembrano, operator of Shell gas station in Brgy. Can-adieng said that their head office sets the prices. What they do is monitor the prices from other stations especially that of Star Oil which is nearest to them and report this to their Manila office which, in turn, sets their price.
Antonio E. Labios, director of Department of Energy’s (DOE) Visayas field office agreed to this, saying that unlike small players that can adjust their prices independently, operators of big gas stations namely Shell, Petron and Caltex are under contract to adhere to the prices imposed by their franchisees.
Labios added that Ormoc and Bohol undergo the same experience in which fuel prices are higher in Tagbilaran than those in other towns in the province. He explained that oil companies’ pricing strategy varies from place to place based on economies of scale.
Nevertheless, DOE cannot impose price controls to a deregulated industry like oil in a free market economy, though it can monitor prices and look out for unreasonable increases. The Department of Trade and Industry is helpless too considering that oil is not a prime commodity, said Provincial Director Ed Belas who was also present.
Capahi, chairman of the SP Committee on Energy and Conservation, zeroed in on cartelization. He cites Petron which carries the same fuel prices as that of its competitors despite operating the one and only bulk plant in Ormoc. Glen Adanza, area sales executive of Petron Corp. didn’t answer the concern considering that pricing is not within the scope of his responsibility.
Sembrano, for
his part, reiterated that their head office determines their pricing. While
admitting that he monitors his competitors’ prices which he relays to Manila, he
clarified that only when his sales are hurting will Shell Inc. set his price to
match that of the small players.
But Capahi pressed on with his theory of price manipulation. Unlike stations of big oil companies, small players can buy from different suppliers, he notes, and each gas station has different delivery costs. “Why are your prices the same to the last centavo?” he asks. “This cannot be by accident. Nag-collude ba ang mga operators sa ilang presyo? Nagsabot-sabot ba sila to manipulate their prices? This is an issue of cartelization, mao man gyud ni ba!”
Labios replied
that the existence of a cartel is hard to prove. Belas seconded by saying it
will take more than photos of fuel prices displayed on gas stations to prove
the accusation. The accuser has to produce documents and witnesses, among
others. “Oil is a homogenous product which is hard to manipulate the price but
difficult to explain in a marketing point of view,” the DOE director added.
The inquiry concluded with no clear answers. Labios suggested that another inquiry be set, this time with the presence of personnel from Oil Management Bureau of DOE and from oil companies who are responsible for pricing, to get to the bottom of the matter. (OCMC)
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