Jul. 14--Responding to public clamor for more price cuts at the pumps, independent player Unioil Petroleum Philippines Inc. implemented a steep reduction in its fuel prices.

Effective 12:01 a.m. Tuesday, Unioil would roll back the price of its gasoline by P4.50 per liter, diesel by P3.50 per liter and kerosene by P1.50 per liter, inclusive of the value-added tax (VAT).

An independent player, or one of the local oil firms that entered the market after the downstream petroleum industry was deregulated more than a decade ago, Unioil operates fewer than 50 stations located mostly in Luzon.

Unioil General Manager Chito Medina-Cue Jr. said that lowering the pump prices of their products would counteract the strategy of the competition wherein other oil players are cross-subsidizing diesel prices by pricing gasoline products at a much higher level.

He added that the company's decision to cut prices stemmed from the continuous downward trend in world crude prices and the company's earlier commitment to sell to the public high quality petroleum products at fair prices.

Prior to the latest rollback, Unioil sold its unleaded gasoline at P39.69 per liter, premium gasoline at P40.19 per liter, regular unleaded at P39.41 per liter, E10 at P39.44 per liter, diesel at P31.04 per liter and kerosene at P39.94 per liter.

Unioil's price cut came on the heels of a P1.50 per liter reduction implemented by Pilipinas Shell Petroleum Corp., Phoenix Petroleum Philippines Inc., Seaoil Philippines Inc., Petron Corp. and Chevron (Caltex) Philippines Inc. across all fuel products over the weekend.

Oil company officials earlier attributed the reduction to a drop in international oil prices last week compared with the previous one, because of increasing inventories of petroleum products abroad in the light of lukewarm demand.

The oil firms, however, remain mum if they would also adjust their prices the same way Unioil stretched its rollback.

Since the beginning of the year, petroleum companies have been adjusting prices on a weekly basis to keep local prices in tune with fluctuations abroad as the country imports more than 90 percent of its oil requirements.

This tack, however, has drawn flak from a number of groups both from the government and non-government sides because of successive price hikes implemented in the last two months.

In a statement, the umbrella group Bagong Alyansang Makabayan (Bayan) said that oil firms should not stop with the P1.50 per liter rollback as fuel prices are still substantially overpriced.

"There has to be a substantial rollback in oil prices to reflect the significant drop in world oil prices. Crude now stands at $60 per barrel, down from a high of $71 per barrel. The latest rollback of P1.50 per liter is definitely not enough. The oil companies continue to profit immensely by not implementing a substantial rollback," said Renato Reyes Jr., Bayan secretary-general.

In a recent study, the group accused the "Big Three" oil firms (Petron, Shell and Chevron) of pocketing P138.14 million daily in extra profits from overpricing. The Arroyo administration, on the other hand, earns P22.78 million every day in VAT collections from overpriced petroleum products, Bayan said.

The group said that oil companies should roll back prices to offset their overpricing and for the government to repeal the Oil Deregulation Law, and junk the 12-percent VAT on oil to substantially bring down pump prices.

-----

To see more of The Manila Times, or to subscribe to the newspaper, go to http://www.manilatimes.net.

Copyright (c) 2009, The Manila Times, Philippines

Distributed by McClatchy-Tribune Information Services.

For reprints, email tmsreprints@permissionsgroup.com, call 800-374-7985 or 847-635-6550, send a fax to 847-635-6968, or write to The Permissions Group Inc., 1247 Milwaukee Ave., Suite 303, Glenview, IL 60025, USA.

OTC-PINK:UNLL, Philippines:PNX, Philippines:PCOR, NYSE:CVX,

A service of YellowBrix, Inc.