The Unlawyer

The fuel prices depicted above already reflect the PHP 1 per liter reduction in gasoline prices announced last week, as well as the PHP 1 per liter increase in the cost of diesel.

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Gee, perhaps they were the last to know? Some Philippine leftist organizations conducted an “awareness campaign” last Friday about the evils high oil prices among, get this, bus and jeepney drivers:

“Nita Gonzaga, [Kilusang Mayo Uno] vice president for women’s affairs, said since they could not force President Gloria Macapagal-Arroyo to step down, they would just “educate” the people instead.

“”Ito ay isang awareness campaign para sa mga driver na hindi maganda ang nagiging resulta ng pagtaas ng gasoline [This is an awareness campaign for the drivers on the ill effects of the rising prices of gasoline],” she said.”

They could have done something more useful, like teaching these men, legendary for their boorish behavior on Metro Manila’s streets, such useful skills as obeying traffic laws for instance, or even simple traffic courtesy. That would have been a more worthwhile endeavor.

The Congress will open its doors again later this month and President Gloria Macapagal Arroyo will be delivering her customary State of the Nation Address then. I haven’t given it much though yet but At Midfield wonders what will the President talk about on that day.

Truly disturbing news: Saudi Arabia’s oil reserves, reputed to be the largest in the world and which include the mighty Ghawar oil field, may not be as big as originally thought. Saudi Oil: A Crude Awakening on Supply?

“However, it appears that for at least the next five years, and possibly longer, the Saudis are likely to produce less crude than promised, according to fresh data on the kingdom’s oil fields obtained July 9 by BusinessWeek. Saudi officials have said they would increase production capacity to 12.5 million barrels a day next year, from the current 10 million barrels a day, and could even ramp up to as much as 15 million barrels a day if the market demanded it…

“But the detailed document, obtained from a person with access to Saudi oil officials, suggests that Saudi Aramco will be limited to sustained production of just 12 million barrels a day in 2010, and will be able to maintain that volume only for short, temporary periods such as emergencies. Then it will scale back to a sustainable production level of about 10.4 million barrels a day, according to the data…”

The reputation that the Saudis possess as the Organization of Petroleum Exporting Countries’ chief enforcer lies precisely in its perceived ability to pump massive amounts of crude oil out of the ground at short notice, among other things. Nobody really knows, however, how much oil they do have underground as they have refused to supply actual production data for over two decades now. Yet the Saudis are quick to defend their reputation, and are keen to reassure everyone that yes, they still have plenty of the black stuff to go around.

Filipinos hoping for a reprieve from the 12 percent value-added tax (VAT) imposed on petroleum products should cease doing so: Arroyo won’t scrap VAT, hits ‘popular but short-term gains’.

“”Repealing other taxes on oil and power will strip the vast majority of our people the means to ride out the world food and energy crisis,” [President] Arroyo said in a speech launching the government’s energy saving programs by the use of compact fluorescent light at the Philippine International Convention Center Wednesday.”

She intends to use the windfall VAT collected on gas and oil in the following manner, including another PHP 500 dole-out to the poor:

“The government last month announced a similar P4-billion package aimed at mitigating the impact of soaring fuel prices. It included P2 billion in subsidies for lifeline power users (equivalent to a P500 cash grant for those using 100 kilowatt-hours or less per month), P1 billion for scholarships and student loans, and a P1-billion credit facility for the conversion of public utility vehicle engines to make them run on alternative fuels.”

That windfall may not last very long if crude oil prices begin to decline: Oil plunges – biggest drop in 17 years. Let’s not put our hopes up too high though:

“Longtime market observers cautioned that the turnaround may not signal a lasting shift in sentiment – prices have swung violently in recent days as they flirted with record highs. But it does underscore investor uncertainty about the sustainability of sky-high prices and their potentially long-lasting effects on the broader economy.”

As of today, crude oil prices are still falling in world markets. Don’t break out the champagne just yet.

Simply put, the market believes continued high oil prices will result in a weaker US economy, which if it does come to pass will certainly mean bad news for us.

At any rate, Patricio Mangubat claims that government has little incentive to keep a lid on fuel prices:

“Government is supporting these oil price hikes because the [Bureau of Internal Revenue] is collecting more money from VAT. Imagine, VAT collections from fuel has reached 80 billion pesos already. The more these giant oil companies hike those prices, the more government goes happy all straight to the bank”

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In travel news, the mothballed Ninoy Aquino International Airport (NAIA) Terminal 3 will be partially opened to the public on July 22, 2008 for certain domestic flights. Cebu Pacific is so far the only Philippine carrier that announced its participation in the move:

“We will phase our transfer to NAIA Terminal 3 by initially transferring our ATR operations on July 22, to be followed by the balance of our domestic flights. International operations will also move to Terminal 3 later in 2008,” said Candice Iyog, CEB vice president.

“CEB flights from Manila to: Boracay (Caticlan), Laoag, Naga, San Jose (Mindoro), and Tuguegarao will be the first to operate out of the new terminal starting July 22.”