Garin: Anti-competitive acts persist in oil sector

The Department of Energy (DOE) acknowledged the possibility of cartel-like behavior and other anti-competitive practices in the local fuel industry amid ongoing irregularities in pricing and import data.

DOE Officer-in-Charge Sharon Garin said the agency remained vigilant against potential collusion among oil players, noting that while a formal cartel had yet to be confirmed, there were persistent red flags in the industry.

“I would not say that there was no cartel. Who they were, that was something to confirm. But if there was no cartel, there was no purpose for the OIMB (Oil Industry Management Bureau) to be on guard all the time,” Garin said during a press conference on Wednesday. “There was still some form of anti-competitive behavior in some, not all.”

Garin added that although the DOE did not have the authority to investigate or prosecute such behavior directly, it referred suspicious activities to relevant agencies such as the Philippine Competition Commission, Bureau of Customs, and Bureau of Internal Revenue.

“Unfortunately, we were not given the authority, not even just to disclose or to investigate their reporting. We just needed to monitor that it matched the increases of the adjustments in the international market,” she said.

Garin pointed to disparities in fuel import records, especially mismatches between reported exports from foreign suppliers and the country’s import declarations.

“There were still distortions in the reporting, in our observations, there were even errors. One simple example was that we aggregated all those that they exported to the Philippines, and then we checked our importation records; they did not match,” she explained.

She said such gaps might have pointed to smuggling or misdeclaration, adding that some players were “not obedient” to existing rules and regulations.

While Garin refrained from directly labeling current price adjustments as evidence of cartelization, she acknowledged that the uniformity of pump price movements across companies had raised questions.

Meanwhile, OIMB Director Rodela Romero clarified that fuel price adjustments often appeared uniform because oil companies used the same international benchmarks, which were the Mean of Platts Singapore and Dubai crude.

Romero noted that the DOE had earlier pushed for a circular mandating cost unbundling to improve transparency. Despite similar adjustments, she emphasized that retail pump prices still varied at the station level due to market competition.

To recall, a 2012 review on cartelization in the oil industry failed to find evidence of collusion. However, Romero noted that the situation might have changed over time. She said the industry continued to evolve, and a fresh study could be warranted if specific violations or issues were identified.

In a separate development, Caltex announced that afternoon that it raised pump prices by P0.25 per liter for gasoline, P0.50 for diesel, and P0.30 for kerosene.

This came a day after fuel retailers implemented a rollback of P0.70 per liter for gasoline, P0.10 for diesel, and P0.80 for kerosene, following the previous week’s larger reductions of P1.40, P1.80, and P2.20 per liter, respectively.