MANILA, Philippines — The government concedes that it can't stop oil companies from jacking up fuel prices once the freeze order on fuel prices is lifted, but warns it would keep tabs on their increases.

"Under a deregulated market condition, the government can't do anything to stop free market players from doing what they want to do,'' presidential economic spokesperson Prof. Gary Olivar said Friday in a phone interview.

But Malacañang reminded the oil companies that the Department of Justice-Department of Energy Task Force would continue to keep tabs on their increases and take action if necessary according to law.

There's no recommendation yet to lift Executive Order 839, which President Macapagal-Arroyo issued on Oct. 23 and put a cap on fuel prices based on their Oct. 15 levels in Luzon that was placed under a state of calamity in the aftermath of two powerful storms.

Flying V chair Ramon Villavicencio had alerted the public to brace for an increase in the prices of gasoline and diesel by P4.50 a liter once Malacañang decides to lift the price cap.

Villavicencio said he would propose to executives of other oil companies to stagger the increase over a three-week period of around P1.50 a liter per week.

The oil industry, backed by big business groups, had fiercely opposed the EO and called for its lifting, arguing they were incurring losses because of the huge gap "between the cost and the pump price.''

The executives had gone so far as requesting a dialogue with Ms Arroyo for the lifting of the order, but Malacañang balked at this and said any consultation should be done with the DOJ-DOE task force.

Press Secretary Cerge Remonde shrugged off Villavicencio's pronouncement on the future increases, saying ``We will allow the spokesmen and executives of oil companies to let off steam.''

But he said that the DOJ-DOE task force would continue to monitor their increases, and would take its cue from there.

"Yes the task force will continue to monitor. Remember you earlier told me there might be a shortage or diversion of supply. Remember I told you we should not be fooled by those statements ... If they will divert or resort to hoarding, we will throw the book at them,'' he said.

Remonde also warned the companies against painting grim scenarios.

"In the meantime, we continue to appeal to the oil companies and their executives to stop raving and ranting because they are not helping the situation ... and definitely they cannot blackmail this government,'' he said.

While it's helpless against future price increases in a post-EO 839 period, the government could appeal to the oil players to act responsibly by being transparent on their operations, Olivar said.

"We can appeal to them to behave responsibly,'' he said by phone. "They produce a commodity that is essential, with very few substitutes, and commands a big slice of people's budget. The nature of their business demands that they behave with more responsibility than other regular businessmen.''

For starters, the oil companies should justify the future price increases, Olivar said.

"As part of their being responsible, they should make an effort to justify why they're going to do this if they care at all how the public feels about this,'' he said.

Secondly, the oil companies should "shed light'' on their inventory accounting methods, forward supply contracts, and the manner and cost of transporting oil from the source to its destination, Olivar said.

"If they want sympathy and understanding from the public, they have to be more transparent about their finance operations, and not just about their financial statements,'' he said.

Remonde also said he wasn't aware of any proposal from the oil companies to impose the cap on fuel prices in ``hot spots.'' He also clarified that Justice Secretary Agnes Devanadera has never recommended the possible lifting of the order in certain areas.

Devanadera was quoted in the papers as saying that there "may be a lifting of the freeze order in certain areas such that only specific local government units are covered."