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VILLAFUERTE TO GOV’T: IMPLEMENT OIL RESERVE PLAN

Camarines Sur Rep. LRay Villafuerte is hoping the incoming administration of President-elect Ferdinand “Bongbong’ Marcos Jr. (BBM) will consider putting up a national strategic petroleum reserve (SPR)—a long-conceived government plan that has “sadly crawled at a snail’s pace” at the Department of Energy (DOE)—especially now when domestic pump prices of fuel are close to reaching the level of P100 per liter.   

“Given the seemingly endless oil price spiral in the world market, one way for the incoming BBM administration to stabilize the retail cost of petroleum products—and shield consumers and motorists from the debilitating effects of sky-high prices of gasoline and fuel—is to put up a state-run storage facility that would enable the government to bring in additional inventory that could help soften future price surges,” Villafuerte said.

Villafuerte earlier expressed disgust over the DOE officials’ “utter lack of a sense of urgency on the SPR plan.

“I hope the BBM administration will take a long look at the SPR plan, which has unfortunately been stuck in the planning stage at the DOE for over two years now,” said Villafuerte, who had broached the idea of a national fuel reserve more than two years ago. 

“Our DOE officials have for years been talking the talk about a national SPR, but they have yet to walk the walk on this planned reserve for petroleum products,” Villafuerte said. “In fact, the best that DOE Secretary (Alfonso) Cusi has done to calm an anxious public is to tell  some three months back that the PNOC (Philippine National Oil Co.) has been tapped to do a feasibility study on it.”

“The long-talked-about fuel reserve plan has sadly crawled at a snail’s pace at the DOE as our energy officials have been taking their own sweet time putting flesh into this SPR. As I have said before, they should be putting their money where their collective mouth is—rather than just emitting hot air with this blabbering (about studying a national fuel reserve plan) that only contributes to planet heating,” Villafuerte said.

Villafuerte issued this statement as retail prices of petroleum products are set to go up this week for the third time in a month. Following the latest two price adjustments, the cost of gasoline has already gone up to about P95 per liter of gasoline and that of diesel to some P84 per liter.

With both price adjustments, the aggregate increase of gasoline prices since January has reached almost P29 per liter of gasoline and that of diesel by over P41 a liter.

This week, the pump prices of fuel are expected to rise anew by another P2.40 to P2.70 per liter of diesel and by 30 to 60 centavos per liter of gasoline.

Villafuerte said there seems to be no end in sight for oil price surges as experts list the upside risks in the months ahead as the drag on the global economy of Russia’s invasion of Ukraine; the weakening peso, which is now being traded at over P53 against the greenback; the lockdown in China; the European Union (UE)’s ban on Russian oil imports; and the swelling demand for fuel in northern hemisphere states because of the summer travel peak period between June and September.    

The reelected solon said that much to his chagrin, the best that Cusi could say at a virtual news forum in March was that the DOE had tapped the PNOC to conduct a feasibility study on this SPR plan, and was quoted as telling the media that: “Patapos na kami sa paga-aral na ‘yan. Kailangan natin magkaroon ng strategic storage kung saan natin ilalagay ang supply, and then magkakaroon po tayo ng system how are we going to dispose these.”

Villafuerte recalled that more than three months ago, the DOE’s Oil Industry Management Bureau (OIMB) director Rodela Romero told a “Laging Handa” public briefing at the Palace that the DOE sought to find out in a proposed study the project cost to establish the SPR.

He said what made Cusi’s remarks doubly exasperating back then was that he already knew what the SPR could do and how the Russia-Ukraine war could impact international and domestic fuel prices, and yet “he and his subordinates appeared shorn of any sense of urgency on this critical matter. We could probably be helpless in dealing with this oil imbroglio because nothing has been done by our energy officials, save for spending two years preparing to study the planned oil reserve facility.” 

“What happens now to this long-stalled plan with the anticipated changing of the guards at the Department by end-June?” he stressed.  

Villafuerte earlier expressed disgust over the DOE officials’ “utter lack of a sense of urgency on the SPR plan.

“Look, they are not even studying it; they are still in the preparatory stage on how to go about conducting such a study. I am afraid it is taking the DOE so long to consider the SPR, let alone set it up, to the point that the Philippines might have switched to e-vehicles or hybrid cars already by the time a strategic petroleum reserve is up and running in the country.” 

Although there isn’t any time left to put up such an SPR to address the current petroleum price surge on the Duterte watch, Villafuerte said “energy officials must drop their lackadaisical approach and put this strategic petroleum reserve plan in motion in preparation for future conflicts, supply hitches or any other geopolitical developments or catastrophes that could drive fuel prices to later go up north anew beyond the reach of ordinary Filipinos.”  

Villafuerte recalled that more than three months ago, the DOE’s Oil Industry Management Bureau (OIMB) director Rodela Romero told a “Laging Handa” public briefing at the Palace that the DOE sought to find out in a proposed study the project cost to establish the SPR, along with its ideal capacity, withdrawal schedule and priority sectors to be served.

According to Romero, the DOE was reviewing new terms of reference (TOR) for a rebidding for the procurement of a consultancy service that will conduct the study.

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