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Oil crisis and nationalism

For greedy oil firms, the sky’s the limit. Just yesterday, they announced (again!) that we consumers should expect another round of LPG price hikes, with a P30 per tank increase starting on August 1. Pump prices of diesel, gasoline and other oil-based fuels are also on the uptrend.

Government energy czars repeatedly explain that we can’t stop the oil price hikes because it is a global trend. In the long haul, counting decades, this is probably true. As analysts point out, the “Peak Oil” phenomenon will increasingly turn into a mad scramble for petroleum reserves, drive crude oil prices upwards, and force the global economy to shift to alternative fuel sources.

In recent years, however, global oil prices have been driven up more due to speculative markets. Annual fluctuations are distorted by political factors especially in the Middle East – as the U.S. war bogs down in Iraq, as Western countries try to bully Iran into submission, and as Israel (widely perceived as a U.S. proxy) invades Lebanon and threatens both Syria and Iran (who support Hezbollah).

The situation is so exasperating for ordinary Pinoys, since we now see that local oil firms are so tied up to imperialist interests in the Middle East. We cannot even easily shift to other suppliers of cheap oil that are not affected by war, such as Venezuela, China, or even neighboring Indonesia.

What is more infuriating is that local oil firms have apparently taken advantage of price and currency fluctuations to overprice their local sale of oil products. Based on the latest estimates by IBON, from January to July this year, local oil products have been overpriced by an average of 83 centavos per liter.

Hence, oil firms gained an extra P1.28-billion profit in the first six months. This mind-boggling figure is all the more shocking if we look at the daily equivalent: added earnings of almost P6.05 million every day, for six months straight.

IBON also estimated (based on the 2005 market share of oil firms), that of the total extra profit, around P489 million went to Petron, P412 million to Shell, P202 million to Chevron (formerly Caltex), and P178 million to the smaller oil firms (the so-called new players).

These figures show that there is no urgent need to further increase pump prices. In fact, the government should impel the oil firms to roll back their prices – if only to compensate for their past overpricing.

At the very least, these figures should convince enlightened policy-makers that the Oil Deregulation Law and the policy of privatizing Petron should not have been adopted in the first place.

It should convince the public that, in the next years, we should work for a government that will truly implement a program of nationalist industrialization and social justice, and junk a regime whose only claim to fame is a yearly SONA full of half-lies, alibis, and unmet promises. #

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