Press Release
August 21, 2010

Why Are Petroleum Products More Expensive In Cebu? - Legarda

Senator Loren Legarda asked the Senate Committee on Trade and Industry to conduct a legislative inquiry into the high prices of major petroleum products in the province of Cebu compared to those in Metro-Manila and other areas of the country.

"The Cebu Chamber of Commerce and Industry said the prices of unleaded gasoline and diesel in Cebu are relatively higher by an average of P4.83 than the prices in Metro Manila; by an average of P1.02 than the prices in Iloilo; by an average of P4.06 than the prices in Cagayan de Oro; and by an average of P3.46 than the prices in Davao."

"There is widespread complaint from consumers in the province of Cebu about the cost of petroleum products which are more expensive compared to those in other areas of the country."

"Cebu's general consumers lamented to this representation that expensive petroleum products create a chain reaction in the prices of other commodities, among which are basic necessities, especially those that rely heavily on gasoline and diesel as a factor in the manufacture and delivery of goods."

"This situation prompted certain business and political leaders in Cebu to file charges before the Joint DOE-DOJ Task Force created under Republic Act No. 8479 against the big players in the petroleum industry for alleged cartelization and predatory pricing."

Legarda filed P. S. Resolution No. 120 which intends to ascertain that the state policy expressed under Republic Act No. 8479 - "An Act Deregulating the Downstream Oil Industry" is applied equally to the province of Cebu.

"Republic Act No. 8479 expressed the policy of the State to liberalize and deregulate the downstream oil industry in order to ensure a truly competitive market under a regime of fair prices, adequate and continuous supply of environmentally-clean and high-quality petroleum products. To this end, the State shall promote and encourage the entry of new participants in the downstream oil industry, and introduce adequate measures to ensure the attainment of these goals."

Legarda concluded, "It is incumbent upon the Senate to determine whether the expressed State policy under Republic Act No. 8479 applied equally to the province of Cebu for the benefit and protection of all its local consumers. "

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