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The two biggest oil companies, Pilipinas Shell Petroleum Corp. and
Petron Corp., earned nearly P70 billion in combined net profits
after the passage of the Downstream Oil Industry Deregulation Law in
1998, a lawmaker said Sunday.
Shell earned P33.59 billion in cumulative net
profits from 1998 to the first quarter of 2008, while Petron posted
P35.18 billion in profits during the same period, Cebu Rep. Eduardo
Gullas said in a press release, citing reports filed with government
regulators.
“Consumers are now extremely vulnerable to
potential pricing abuses,” he said in the statement.
With the series of oil price hikes starting from
January 2008, the
petroleum companies have increased diesel and kerosene prices 20
times, by about P22 to P24 per liter. They have also raised gasoline
prices 19 times, by some P19 per liter.
”The Downstream Oil Industry Deregulation Law
has definitely been a boon to the two oil refiners and other
[industry] players,” Gullas said.
“There is also no question that as a result of
soaring world oil prices, industry players are enjoying enormous
pricing power that has enabled them to pump up their profits.”
Based on his research, Gullas said Shell had
reported a net profit of P3.1 billion from January to March this
year. Petron posted a net profit of P658 million in the same period.
From 2005 to 2007, Shell’s annual net profit averaged P5.41
billion, while Petron’s averaged P6.03 billion.
In a previous story in The Manila Times, a Shell
executive conceded that the company made big profits but reinvested
those into the business, particularly in costly oil explorations.
The third-biggest local oil firm, Chevron
Philippines Inc. (formerly Caltex), has since closed down its
72,000-barrel of oil per day refinery in San Pascual, Batangas.
Chevron now merely operates a finished petroleum product import
terminal in Batangas with the capacity to store 2.7 million barrels.
The figures with respect to Chevron’s
financial performance were not readily available. Chevron is no
longer subject to the same rigorous disclosure and financial
reporting rules that apply to Shell and Petron. Chevron nonetheless
last reported a net profit of P2.75 billion in 2006.
Petron controls 39 percent of the local
petroleum market. Shell has a 31-percent market share, and Chevron,
15 percent.
New oil players corner the remaining 15 percent.
Petron runs a 180,000-barrels of oil per day refinery in Limay,
Bataan. Shell runs a 110,000-barrels per day refinery in Tabangao,
Batangas.
The Cebu congressman called on the Department of
Energy to protect consumers’ interests, adding that it is
empowered by the Downstream Oil Industry Deregulation Act to act
against price manipulation and other similar abuses.
-- Jomar Canlas
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