Sunday, March 02, 2008 3 firms jack up fuel by 50 cents
A 5O-CENTAVO increase in the prices of fuel shows that an oil tariff cut is “a useless mechanism” and will fail to protect consumers from abuse, an alliance of militant groups said.
As of midnight Saturday, oil firms Petron, Shell and Chevron raised the prices of diesel, gasoline and kerosene by 50 centavos per liter.
Arnold Padilla of Bagong Alyansang Makabayan (Bayan) pointed out that the change came barely a month since oil companies slashed diesel prices by P1 per liter.
“It confirmed our suspicion that the diesel price reduction last month was only for publicity to show government response to the people’s clamor to control and reduce oil prices,” Padilla said in a press statement aired by the GMA television network.
Various sectors and even legislators have called for the lifting the 12-percent value-added tax (VAT) on oil products, to help reduce prices of petroleum products.
On Friday, oil prices surpassed US$103 a barrel for the first time as persistent weakness in the US dollar and the prospect of lower interest rates attracted fresh money to the oil market.
“Due to the weakening dollar and the rising fear of inflation, investors have put money into commodities, oil included,” said Victor Shum, an energy analyst with Purvin & Gertz in Singapore.
“Commodities, as tangible assets, do not face as much inflationary threat as opposed to holding a currency,” Shum said.
“Even though the value of money is changing, the asset continues to have an intrinsic value.”
“Right now, there’s a lot of trading based on emotion— emotions are high and that could keep crude oil at elevated levels, but the market faces the risk of a price collapse.”
The Organization of Petroleum Exporting Countries holds its next policy meeting on March 5. It is likely to decide to keep current production levels unchanged, or even cut production, according to reported comments by OPEC President Chakib Khelil. (Sunnex/With AP)
