Most economists, looking at the prospects of the global oil industry, are now talking about a scenario that would have been unimaginable or at least unspeakable 10 years ago – the era of $100-per-barrel global oil prices.
In 2006, global oil prices leaped from around an average of $70 per barrel to a record-high of $99, which almost but not quite broke the psychological barrier.
Last year, especially towards the year-end, oil prices hovered around the $90 per barrel mark. Then, on January 2, 2008, the barrier was finally broken when per-barrel prices hit the $100 mark for a brief period.
In succeeding days, oil prices receded somewhat below that mark. But the short spike triggered global alarms, and led economists worldwide to more seriously consider the possibility of such temporary spikes becoming the normal price level. Some experts predict that oil prices could hover above $90 in the coming months, exceed $100 around December this year, and remain above that level in the coming years.
This scenario should lead our country’s economists, legislators, and other policy-makers, to also more seriously consider not just palliative measures to ease the impact of higher oil prices, but longer-term defensive measures that should effectively shield the economy from the worsening crisis.
In this light, we totally support a number of legislative proposals that would benefit the oil-consuming public and even our government’s continuing interests in the local oil industry.
One set of three proposals were recently filed by progressive party-list representatives Teddy Casiño and Satur Ocampo of Bayan Muna, Crispin Beltran of Anakpawis, and Luz Ilagan and Liza Maza of Gabriela.
HB 3029 proposes to regulate the “downstream petroleum industry” (products of the refining and post-refining processes), and is designed to effectively give back strong government controls on oil prices. HB 3030 proposes to institute a centralized system for procuring oil to ensure that we buy oil from the cheapest sources available in the world, while HB 3031 – the most crucial – proposes to re-nationalize Petron Corporation so that the government can use it as leverage against the private oil cartel.
We also note that Senators Manuel Roxas and Juan Ponce Enrile are now pushing for the passage of an anti-trust law that may be used by the public to better fight cartel practices, particularly in the oil industry.
On top of these, we reiterate the long-standing public outcry for the government to repeal the Oil Deregulation Law (which, so far, is only likely to be subjected to review by Congress) as well as the expanded VAT law, to at least provide immediate oil price relief to the consuming public and to our heavily oil-dependent economy.
But, ultimately, what our country needs by way of defensive measures is a strong and self-reliant economy that is driven by a robust and comprehensive mix of nationalized major manufacturing industries (including the oil and power industries) and a system of agriculture truly modernized by land reform, which can provide other energy sources, such as biofuels, without sacrificing basic food security. #