The Department of Energy (DOE) has once again called for the amendment of Republic Act (RA) 8479 or the Oil Deregulation Act that would allow the government to intervene and address sudden or prolonged oil price hikes.
Under the law, local oil prices are evaluated based on global oil prices.
DOE Usec Gerardo Erguiza Jr said that the department is also pushing for the “fuel cost unbundling” rule to be included in the amendments in order to determine the real and passed-on costs of petroleum retail products.
During the Senate consultative meeting on Tuesday, Erguiza said that the “industry take” of oil companies in fuel prices is at 19%, landed costs account for 51%, and a portion of pass-on costs are factors in the taxes imposed on petroleum products. He added that the DOE would like to inquire about the said costs.
While Energy Sec. Alfonso Cusi issued Department Circular 05-0008 series of 2019 which required the unbundling of oil prices for data gathering and policymaking purposes, Erguiza said that the circular is subject to an injunction by the courts following opposition from oil industry players.
“That is why we want this to be incorporated in the law para may ngipin ito at makita natin talaga ang transparency,” Erguiza said.
The DOE official that if the Senate would decide to suspend fuel excise tax, it could be incorporated into the minimum requirements under the Oil Deregulation Act.
In related developments, Senator Grace Poe is set to refile a bill that would temporarily suspend oil excise tax by amending Section 148 of RA 8424 or the National Internal Revenue Code of 1997. The amendment looks to automatically suspend excise tax on regular gasoline, unleaded premium gasoline, and diesel if the average Dubai Crude Oil based on the Mean of Platts Singapore hits $80 per barrel for three consecutive months.
Poe first filed the bill in November 2021. In March, the DOE already called for the amendment of RA 8479 to help ease the soaring fuel prices amid the conflicts between Russia and Ukraine. DOE also called for the amendment in October 2021 when oil prices began to rise.
