FLAT INFLATION. Eastern Petroleum chair Fernando Martinez said on Friday (Dec. 15, 2023) that inflation in the prices of petroleum products has been virtually flat since 2015. Relatively stable oil prices present opportunities to pursue food security and other developmental targets, Marquez said. (Photo courtesy of F. Martinez Facebook)
MANILA – A local oil executive on Friday said relatively low prices of petroleum products in the country present a good opportunity for the government to focus on food security goals and for private businesses to pursue expansion targets.
In an interview, Eastern Petroleum chairperson Fernando Martinez said current pump prices are almost identical to their 2008 levels, even while workers’ salaries and transport fares have risen several times in the past 15 years.
He pointed out that the domestic petroleum industry is the only sector in the Philippine economy that has seen virtually flat inflation since 2015, if the price movements of fuel were to be averaged out over the past eight years.
“We (petroleum industry) are always the scapegoats in justifying fare hikes and raising the prices of other goods due supposedly to higher transport costs. But if you look at the big picture, we seem to be the most inflation-resistant sector. We raise prices when dictated by the world market but we also implement significant rollbacks,” Martinez told the Philippine News Agency.
The oil executive said that despite deliberate attempts of the Organization of the Petroleum Exporting Countries (OPEC) to raise world market prices by cutting its production, the slowdown of China’s economy has substantially dampened fuel demand.
The Asian economic giant’s muted demand is the factor currently keeping oil prices at bay, he further explained.
“With fuel relatively cheap, we should focus on food production… private companies should think about filling the production gap being left by China. The share of fuel in the overall cost of production is shrunken if you study the charts on the movements of oil prices,” he said.
After being a part of the business delegation that joined President Ferdinand R. Marcos Jr. at the 2023 APEC (Asia-Pacific Economic Cooperation) Summit in San Francisco, California, USA in November, Martinez said it became evident to him that foreign investors are once again bullish towards the Philippine economy.
Martinez, the founding chair of the Independent Philippine Petroleum Companies Association, said Marcos has made himself “engaged and accessible” to the business community, and “his focus on bringing in business and technology is what sets him apart from the previous administration.” (PNA)
