MANILA, Philippines?Having incurred about P81 million in losses for a six-day period, Pilipinas Shell Petroleum Corp. on Wednesday warned of a ?crippled oil industry? as it asked the Makati Regional Trial Court to halt the implementation of the Malacañang order imposing a price cap on oil products.

Willie Sarmiento, Shell?s vice president for finance, claimed the oil company had incurred losses of about P80.9 million from Oct. 26-31 alone, following the Palace directive which they called ?unjust, oppressive and unconstitutional.?

?The continued effectivity of Executive Order 839 will irreparably distort the supply and demand for petroleum products and thus, crippling the entire oil industry and imposing a significant and negative impact on the operations of business, dependent on petroleum products,? he said in his testimony on Wednesday.

Pilipinas Shell, one of the so-called Big Three oil companies, filed the injunction case last week against Executive Secretary Eduardo Ermita, Energy Secretary Angelo Reyes and Department of Energy-Department of Justice joint task force, questioning the legality of EO 839.

EO 839, which took effect on Oct. 24, pegged oil prices in Luzon at their Oct. 15 levels.

Shell said that unless restrained, the continued implementation of EO 839 would cause grave and irreparable injury to their company, which has been selling petroleum products in Luzon ?at a loss.?

But Sarmiento, who was Shell?s witness for the case, admitted that the company?s estimated losses were based on a ?mathematical computation? and were not backed by financial reports.

Assistant Solicitor General Marissa Macaraig said the case could become moot and academic since EO 839 was only temporary.

?It would eventually be lifted,? she told reporters at the sala of Judge Winlove Dumayas of Makati RTC Branch 59.

Shell, however, insisted that the EO?s ill effects were widespread, and the supply disruption it caused could already be seen in their own gas stations as well as their competitors.

?The prices imposed by EO 839 were not based on the market forces and the costs incurred by Shell. Indeed the DoE in its Oil Monitor shows that while the price for diesel is frozen at P28, we should be selling at P33.67, while for gasoline the price is frozen at P36.41 when we should be selling at P42.73,? said Sarmiento.

The losses due to the price ceiling, said Shell, adversely affected their working capital which is used to fund the importation of oil, service its substantial debts, and pay maintenance, labor costs and overhead expenses, among others.

Shell also feared the layoff of 200 workers and several thousand contractors who work for the oil company and its service providers; and the eventual closure of its sole oil refinery.

?With the depletion of Shell?s working capital and the impending closure of its sole refinery, Shell?s ability to supply the Philippine market is in peril,? Sarmiento said.

Energy Secretary Angelo Reyes? testimony during another hearing Wednesday left more questions than answers.

Reyes appeared in court Wednesday as an amicus curiae or ?friend of the court? and testified on the motion for the issuance of a temporary restraint and writ of preliminary injunction on the continuing increase of oil prices, which the SJS had filed.

He arrived at the court around 9 a.m. but he first had a closed-door meeting with Manila RTC Branch 26 Judge Silvino Pampilo Jr. before the hearing started. With a report from Tina G. Santos