Shell to comply with oil price order

Phillipines :
PILIPINAS Shell will comply with a directive to keep oil prices at October 15 levels but it not ruling out moves to bring the matter to court, said the company's vice president for communications Roberto Kanapi.

Shell will also ask the energy department to clarify some issues concerning Executive Order 839, such as the fuel products included, its period of effectivity, whether it refers to the suggested retail price or actual retail price, and the directive's coveragesince not all Luzon areas where affected by typhoons Ondoy and Pepeng.

"While the intent of the order is to prevent unreasonable increases in prices of petroleum products during a state calamity, the consequences of the (EO 839) would be supply disruptions and a negative impact on the investment climate in our country. We will continue to discuss these issues with the Department of Energy - Department of Justice (DOE - DOJ) Task Force and other relevant government agencies," Kanapi said.

Kanapi said Shell expects the demand for petroleum products to go up since several players have indicated they may stop selling. Also, he added, commercial and industrial users of fuel, which are not covered by EO, may opt to buy from Shell retail stations to take advantage of the low prices.

In a statement, Shell in fact said it expects a "significant" shift in the fuel sourcing of commercial and industrial accounts from oil companies to retail sites. 

Hence, in compliance with the EO and so that victims of calamities would be the ones to benefit from subsidized oil prices, Kanapi said Shell will ration the sale of petroleum products to retail stations, basing the volume on their average sales in recent months.

"We will not accommodate those big volume off-takers that would come to our stations with containers and trucks, unless they are regular customers. These lower rates at retail stations are meant for victims of calamities," added Kanapi.

Another oil company,  Unioil Petroleum Philippines Inc., vowed to comply with directive.

"We would like to assure the public that Unioil has enough supply of petroleum products in our inventory to comply with the President's directive. There will be no problem in the normal flow of petroleum products in all our retails stations," Unioil  general manager Chito Medina Cue said.

He said they can bring in fuel products from foreign suppliers within three days if there is a shortage of supply in the local market.

"There is nothing to be afraid of as there is no shortage of supply in the international market for finished petroleum products. To bring in the products, we will just need three days at the most as long as the appropriate government agencies will expedite the processing of documents for the release of the imported fuels," Medina Cue said.

Medina Cue said the energy department should monitor retail station of Unioil's competitors to make sure they are complying with the order.

Other oil firms have started to roll back prices by P2 per liter for diesel, P1.25 per liter for unloaded premium gasoline, P0.85 per liter for regular gasoline, and P1.50 per liter for kerozene in Luzon. (MSN/Sunnex/Sun Star - Philippines)