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March 14, 2012
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1. The global oil industry is dominated by a few transnational
corporations (TNCs) from the US & Europe that impose excessiveprices
2. Global oil prices are further artificially bloated by speculation
3. Exorbitant global oil prices are fully shouldered by Filipino
consumers & motorists due to Oil Deregulation Law
4. Deregulation did not dismantle but even strengthened PH oilfirms w/ ties to global oil monopoly
5. Local prices are further made excessive by the imposition of the
12% value-added tax (VAT)
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Shell (UK/Netherlands), ExxonMobil (US), BritishPetroleum (UK), Chevron (US), & Total (France)control:
72% of total revenues of top 10 oil companies in terms ofrevenues (including state-owned firms )
58% of production capacity, 65% of refining capacity, &
75% of sales of top 10 oil companies in terms of oilreserves (including state-owned firms)
Shell total revenues is twice the size of PH economy(2010)
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Estimates range from $28.08 to $41.91
If Dubai crude is at $109.54 , thats a $67.63 to
$81.46 difference which represents monopolyproifts and price speculation
Wikileaks cable July 2008 Saudi Oil ministertells US envoy that up to $40/barrel in oilprices is due to speculation
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Financialization & deregulation of US futures
market allowed massive speculation in
commodities (speculative entities hold asmuch as 70% of oil contracts in futures
market)
Industry admits speculation (US EIA,ExxonMobil, Goldman Sachs, Saudi oil
ministry, & even PH DOE)
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Global prices artificially bloated by monopoly
pricing & speculation directly transmitted to
local pump prices
Automatic, weekly adjustments 8 rounds of
OPH in 1
st
10 weeks of 2012 (P5.85/L hike ingasoline; diesel, P3.20; & LPG, P190+/11-kgtank)
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80% of oil sold in the PH go thru production & distributionchain directly controlled by global oil monopoly
Petron, Shell, Chevron, & Total control:
100% of crude oil imports (Petron & Shell)
100% of refining capacity (Petron & Shell)
80%+ of storage capacity
80%+ of retail stations
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Almost P6 per liter added to the pump priceof diesel due to VAT; almost P7 per liter for
gasoline; almost P110 per 11-kg tank for LPG
P1 B in additional VAT revenues for every $1increase in the price of Dubai crude (DOF)
P26 B in estimated VAT windfall for 2012assuming persistent high prices & steadyconsumption
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During the peak oil prices in 2008, govt
reportedly earned P58 billion in VAT on oil
In 2010, VAT on oil revenues estimated at P47Bilion
In 2011, congressional study VAT on oilrevenues expected to reach P70 Billion
In 2010, Aquino promised to recoup P150billion in tax leaks. If half of target was met,
thats equivalent to oil VAT revenues
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SECTORESTIMATED SAVINGS FROM
THE CANCELLATION OF VAT
ESTIMATED NUMBER OF
BENEFICIARIES
JEEPNEY DRIVERS USING 30
LITERS OF DIESEL PER DAILY
TRIPP173 PER DAILY TRIP 426,572 JEEPNEY DRIVERS
TRICYCLE DRIVERS USING 4LITERS OF UNLEADED PER DAILY
TRIPP28 PER DAILY TRIP 581,578TRICYCLE DRIVERS
SMALL FISHERS USING
MOTORIZED BANCAS W/ 10
LITERS OF GASOLINE PER
FISHING TRIP
P69 PER FISHING TRIP 708,000SMALL FISHERS
HOUSEHOLDS USING 11-KG LPG
TANK P100 TO P110 PER TANK 8.6 MILLION HOUSEHOLDS
HOUSEHOLDS USING 4.2 LITERS
OF KEROSENE PER MONTH FOR
COOKING & LIGHTINGP28 PER MONTH 9.4 MILLION HOUSEHOLDS
Sources of data: DOE, LTO, IMF, NSO, PISTON, PAMALAKAYA, INTERVIEWS
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Bring down price of oil as immediate relief forconsumers & motorists by scrapping the VAT
on oil
Control oil prices by junking the OilDeregulation Law & enacting HB 4355
Dismantle the oil cartel & greatergovernment role in the oil industry towardsnationalization of the entire energy sector
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