Independent oil player Unioil Petroleum Philippines Inc. Monday slashed the prices of its gasoline by a hefty P4.75 a liter, diesel by P3.50 a liter, and kerosene by P1.50 a liter—the biggest rollback yet this year.

Unioil general manager Chito Medina-Cue Jr. said the drastic drop was due to the continuous downward trend in world crude prices and the company’s commitment to sell high quality petroleum products at fair prices.

With the rollback, Unioil’s unleaded gasoline will retail at P35 a liter; its Quantum Premium gasoline at P35.44; regular unleaded, P34.66; Pure Diesel Plus (B1), P27.54; and kerosene, P38.44 a liter.

Medina-Cue said the company decided to bring back its “big-time rollback” strategy, which it started last year, to help the public weather the high prices of everything.

As of July 9, the regional benchmark Dubai crude had gone down to $65 a barrel, from a $69 a barrel average in June, data from the Department of Energy showed.

The price of unleaded gasoline based on Mean of Platts Singapore (MOPS) benchmark for refined petroleum products dropped to $72 a barrel in the first nine days of the month from the previous month’s average of $77 a barrel.

Similarly, MOPS-based diesel fell to an average $71 a barrel as of July 6, from the $77 a barrel average posted in June.

While Unioil has so far cut its prices only once this month, other local oil companies have twice slashed the prices of their gasoline and diesel but only by a total of P2 a liter, and of kerosene by P1.50 a liter, to reflect the drop in global crude oil prices.

Energy Secretary Angelo T. Reyes said Monday he would ask the other oil companies—the Big 3, as well as independent players—why Unioil could afford to cut its prices and they could not.

“We will ask the oil industry to explain,” Reyes told reporters.

He also said the DOE would ensure that all price-cut announcements made by oil companies would be felt at the pump.

“We will monitor to see to it that the reduction is being felt by public,” he said.

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Finally, some relief for motorists.

As more people left their cars at home and took mass transportation, oil companies announced last night a rollback of P1 per liter in gasoline prices effective today.

The announcement of Petron Corp., Pilipinas Shell Petroleum Corp., Chevron Philippines (formerly Caltex), Total Philippines, Unioil Philippines and Flying V is expected to provide a respite to car owners, many of whom have opted to leave their cars at home and take public transport instead because of the high fuel cost.

But the announcement matters little to commuters because public utility vehicles – except taxis – run on diesel.

Ramon Villavicencio, chairman of Flying V which was the first to announce a rollback, said they decided to cut gasoline prices because they have already recouped their under-recoveries for gasoline and their margins have improved.

“If there is a need to immediately lower prices, then we will do it. We have somehow recovered our margins for gasoline, unlike diesel where we still have to recover about P6 per liter to become viable,” Villavicencio said.

The unexpected adjustment came on the heels of the sharp decline of as much as $5 per barrel in the price of crude oil in the international market.

The reduction in gasoline price also followed a P2 per liter increase in the price of diesel last weekend.

During the first week of July, the price of Dubai crude, the benchmark of oil refiners, went up to $137.91 per barrel from $127.82 per barrel in June and $119.50 per barrel in May.

Raul Concepcion, chairman of Consumer and Oil Price Watch, led opposition to
proposals for a one-time increase in diesel prices by as much as P10, warning that “we will have revolution on our hands.”

Fernando Martinez, chairman of Eastern Petroleum Corp., said a staggered increase on a weekly basis is still the most acceptable to consumers.

“It would be a disadvantage to all of us and it may even trigger upheavals,” Martinez said.

Record profits

While the Big Three oil firms in the Philippines claim losses, their mother companies abroad continue to report record billions in profits, according to independent think tank IBON Foundation.

IBON noted that Royal Dutch Shell, the mother company of Pilipinas Shell, posted net income of $27.6 billion in 2007, making it the second most profitable company in the world next to oil giant Exxon Mobil. In the same year, Pilipinas Shell recorded profits of P4.12 billion.

Chevron, mother unit of Chevron Philippines, reported net income of $18.7 billion in 2007, nine percent higher than in 2006 and enough to make it the eighth most profitable company in the world. Its local unit reported P2.75 billion in profits in 2007.

Petron recorded profits of P5.94 billion in 2007. Its net income has been progressively increasing in the last three years, settling at P5.76 billion in 2006 and P3.42 billion in 2005.

It is commonly held that giant oil companies’ inflated prices encourage price speculation, which further burdens consumers.

Since January diesel and gasoline prices have increased by P16 per liter. Oil companies said they still need to recover P8 to P10 per liter given the runaway prices of world crude.

Oil companies have been raising their prices almost every week. Pump prices rose for the 18th time this year last Saturday. The continued weakening of the peso against the dollar – now at almost P46 – has also affected fuel prices.

By Donnabelle Gatdul, Philstar Online

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Oil’s Big Three – which sell nine in every 10 liters of fuel in the country – have been urged to follow the lead of Sea Oil Philippines Inc. in selling price-lock prepaid cards to consumers.

Opposition senator Francis Escudero issued the dare to Petron, Pilipinas Shell and Chevron Philippines, which operates the Caltex brand, a week after Seaoil launched the industry-first prepaid card which locks the price of gas for a given time.

Escudero said if a “small player in a small country ” can offer a product that shields consumers from price spikes ” then there’s no reason why this can’t be done by energy giants whose mother companies have been recording super profits”.

“If a scrawny new kid on the block can make the generous offer then oil companies with bigger financial muscle can do no less, “Escudero said.

To be sold between June 10 to 21, Seaoil’s prepaid fuel card can buy 20 liters of gasoline (G5 X-treme and Unleaded) from any of the oil firm’s stations.

At a “locked” price of P53.50 per liter, each card costs P1, 070 and is valid for 11 weeks or from June 10 to Aug. 22.

In the less likely event of a price rollback during the period however, company officials said they will refund the difference.

“This is the beauty of the Seaoil promo. The card price is fire walled against global price increases but if global prices go down Seaoil will give out refunds. For the motorists, there is no win-win offer than that,” Escudero said.

Seaoil has 102 stations all over the country, a drop in the barrel compared to Petron’s 1,200; Shell’s 800; and Caltex’s 850. The three combine for 2,850 out of the 3,369 registered fuel filling stations in January 2006.

In calling for the replication of the Seaoil promo, Escudero particularly directed his appeal to Petron, which remains 40 percent owned by the government until the sale of the latter’s stake to a British holding company becomes final.

“This is one form of imitation that Petron must have no qualms in doing because it serves the public interest and also makes good business sense, “he said.

He said Shell and Chevron “can also initiate a variant” of the Seaoil prepaid card “and they cannot plead poverty in not doing it.”

“Pilipinas Shell is part of a global conglomerate which posted a 25-percent hike in profits in the first 90 days of the year , or $9 billion while local Caltex’s mother company , Chevron, reported a 10 percent hike in profits, or $5.2 billion for the same period, ” he said.

Philippine Senate Press Release

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As gas prices continue to rise there is a real need to maximize fuel usage while minimizing its wastage. Mazda Philippines offers a few helpful and easy-to-do tips to help you save money.

1. A car properly maintained keeps fuel costs at bay – Check the pressure of your tires regularly because low air pressure leads to higher fuel costs. This is due to under inflated tires requiring more energy to begin moving and to maintain speed. Also, head to the Mazda Service Center nearest you to make sure that your car is in optimum condition. A simple oil change could help your engine perform at peak levels and consume less gas.
2. Adjusting your driving style will be worth your while – Don’t be afraid to make your car go “Zoom-Zoom” because a study conducted by a British automotive consultancy found that controlled acceleration is actually more fuel efficient than conservative driving. According to the study the key to saving fuel, is to accelerate hard until the engine reaches 2000 rpm, move up a gear, then put your foot down until you reach 2000rpm again. It may seem counter-intuitive but at 2000 rpm the engine is at its most efficient. Keep in mind though that above 2000 rpm the benefits diminish and you begin using more fuel.
3. Take advantage of offers that allow you to save – Buy the 2008 Mazda3 for only P88, 888 down, with low monthly payments and even 0% interest! The Mazda3’s MZR engine in either the 2.0L or 1.6L have high compression ratios for powerful, yet fuel efficient performance. Enjoy the exhilaration of driving more knowing that your car gets the most mileage out of every gallon.

You can also minimize your maintenance costs by availing of the 3 to 4 years Scheduled Service Plan (SSP) bundled with a 2 year extended warranty. The SSP is a preventive maintenance service that allows you to save on future parts and services expenses. Imagine with just one payment you are assured of peace of mind for the next four years. This also saves you a lot in the long-run because it protects you from future price increases and inflation.

The Mazda3 is available for test-drive in all of the Mazda dealerships for inquiries or to schedule a test drive, call our Hotline number: 85-MAZDA or visit www.mazda.com.ph.

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