MAKATI, Dec 3 — Trade and Industry Secretary Gregory L. Domingo is calling on producers to make adjustments on the prices of their products commensurate to the decrease in transportation costs they are realizing due to the drop in world oil products.
“Filipino consumers,” he says, “should also benefit from the continuous fall in world oil prices that have gone down some 30 percent since June this year.”
Secretary Domingo has instructed the DTI’s Consumer Protection Group (CPG) to determine how much should be deducted from the suggested retail price (SRP) of basic necessities and prime commodities that include agricultural and non-agricultural products because of lower transport and energy costs.
“We are going over our data to check how the price drop should be reflected on the prices of basic and prime goods. The steady decline of oil prices should now have a significant impact on the prices of all products and services. At the minimum, they should decrease by 3 percent,” Secretary Domingo asserts.
At present DTI’s Consumer Protection and Advocacy Bureau has already released guidelines for a number of basic products. As such, a 155-gram can of sardines should go down by P0.22; a 370-milliliter can of evaporated milk by P0.95; a 50-gram coffee refill by P0.99; and a 25-kilogram sack of flour by P25.91.
On Friday, November 28, the Organization of Petroleum Exporting Countries (OPEC), the oil producers’ cartel, decided not to cut output at its 166th meeting in Vienna, Austria and maintain production at 30 million barrels per day as first agreed in December 2011.
Immediately after this, the price of the benchmark Brent crude fell below $72 a barrel, its lowest since August 2010, before settling at $72.82, a 5 percent drop on the day.
With this development, oil prices can be expected to remain low in the months to come.
The Department of Trade and Industry, as the chair and secretariat of the National Price Coordinating Council (NPCC), will coordinate with its members that include the Departments of Agriculture, Energy and Health to determine the extent of the effect of the falling prices of world crude oil on products and services.
Based on Department of Energy (DOE) records, the average pump price of diesel fell about 20 percent this year, from P44.63 per liter in January to P36.71 this November.
DOE records also show the average household LPG price plummet by about 25 percent over the same period, from P45.36 per kilogram to P34.54.
The DTI is urging government agencies such as Land Transportation Franchising and Regulatory Board, Civil Aeronautics Board, Maritime Industry Authority, and the Energy Regulatory Commission, to also assess the impact of the 30 percent decline in world oil prices on trucking and shipping rates, land transportation fare, fuel surcharges, and electricity rates, among others, which are the most immediately affected in the market.
“We are calling on producers and distributors to share the savings they are making on the cost of transportation and energy with consumers, particularly on agricultural products and basic consumer goods,” Domingo adds. “This would be a timely and much needed service to Filipino consumers especially with Christmas just around the corner.” (DTI)
