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Senators confront Reyes over oil shortage warning

By Christine Avendaño
Philippine Daily Inquirer
First Posted 05:15:00 11/18/2009

Filed Under: Oil & Gas - Downstream activities, Consumer Issues

MANILA, Philippines ? Senators on Tuesday confronted Energy Secretary Angelo T. Reyes on his warning that the country was facing a fuel shortage because of an executive order freezing fuel prices in Luzon.

Oil firms told the Senate energy committee chaired by Sen. Gregorio ?Gringo? Honasan that there was no danger of fuel running out in eight to 13 days as Reyes claimed on Nov. 9 because their stocks could last up to a month at that time.

Malacañang the other day lifted the price caps on fuel in Luzon that was imposed to help people in Luzon, including Metro Manila, who where badly affected by two devastating storms.

Sen. Joker Arroyo told Reyes that the latter ?mishandled? the matter because the energy secretary?s statement alarmed the public.

?It?s a good thing transportation and car owners did not troop to gas stations trying to fill up their tanks?,? Arroyo said. ?So perhaps next time, let?s be more circumspect.?

Edgar Chua, president of Pilipinas Shell Petroleum Corp., told senators that Shell still had an inventory of 15 days for finished products and another 15 days for crude.

Jose Jesus Laurel, vice president of Petron Corp., said Petron had an inventory of 22 days for finished products and 33 days for crude.

Upon hearing this, Arroyo asked Reyes why he ?did not correct the misinformation for the peace of mind of the public.?

Reyes said he did so. ?I did reiterate my statement. I was referring to finished good inventory? of Total Petroleum Corp.?s 13-day inventory, Reyes said.

Senate President Juan Ponce Enrile told reporters after the hearing that Reyes had made an ?error? because he ?should have considered the fact that the volume is much, much bigger than just 5 percent.?

Enrile said Reyes was just referring to Total?s inventory, which accounted for only 5 percent of the market.

At the hearing, senators asked why there were still some gas stations that had ran out of fuel. Reyes said a gas station and a refill station at Nagtahan in Manila had ?no stocks.?

The demand for fuel from Petron has increased because small oil firms shut down and their customers ?migrated? to Petron, which has a bigger number of retail outlets in the country, according to its officials.

Enrile asked whether there was hoarding but Petron officials said they did not know. They said demand for Petron products had increased by 10 percent.

Chua said Shell continued to produce fuel.

?We don?t hold back on sales because otherwise the refinery, its tanks will fill up and we have to shut down,? he said.



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