Recto welcomes oil price cuts but calls them ‘slow and small’

Senator Ralph Recto. INQUIRER file photo

MANILA, Philippines – Senator Ralph Recto on Tuesday welcomed the recent rollback in prices by four oil companies but remained dissatisfied over the slow movement and small reductions.

In an interview with reporters at the Senate, Recto said that oil prices now should be lower than it was in November 2010 since the current situation was much better.

Quoting data from the Department of Energy, in November 2010, Dubai crude was selling for $83.65 per barrel while the exchange rate was P43.57 to a dollar. Domestic pump price of gasoline in November 2010 was P44.75 per liter while diesel was selling at P35.50 per liter.

Recto noted that recently, the situation has been faring better. Dubai crude prices have been selling between $82 and $83 per barrel and the exchange rate has been stable from P42 to P43 to a dollar. However, Recto said that as of Tuesday, when he checked prices at gas stations, gasoline price remained from, P49 to P50 per liter and diesel at around P40 per liter. He added that oil prices were even higher in the Visayas and Mindanao provinces.

“I think it should be lower now… And I think masyadong mabagal [it’s too slow],” Recto said. “But I welcome the reductions today. But I wish there were more,” he added.

On Tuesday, Pilipinas Shell Petroleum, Petron Corp., Chevron Philippines and Eastern Petroleum cut prices of premium gasoline by P1.20 per liter, regular gasoline by P1.10 per liter, diesel by 50 centavos per liter and kerosene by 35 centavos per liter.

When asked if local pump price of diesel should be lowered to P35 per liter, Recto said: “thereabouts.”

He added that he expected oil companies to earn more this year than they did in 2011 due to the slow pace of price rollbacks.

Nevertheless, Recto said that the general public seemed to be pleased with the recent rollback.

“I think the general public, as it appears to me, is, to a certain degree is satisfied with the roll back,” he said.

When asked what the Malacañang could do to help hasten the rollback of oil prices, Recto said that the Aquino administration has put up a working group to look into the matter and that he would await the results of the study.

He added that oil prices have been lower in the global market due to the European economic crisis and its possible effect on the American economy and that the Philippine economy may benefit from the Euro crisis.

“That would be good for the Philippine Economy moving forward, so that will mean we have a better chance to be able to sustain our economic growth. So we benefit from, to a certain degree, that’s a benefit for the Philippines now that Europe and America are tinkering,” Recto said.

“Because oil prices are going down, so inflation, expectedly will be low and because of that real growth could be higher. The only con to that is the OFW remittances and the export [industry] will be affected,” he added.