Bencyrus Ellorin .
PETROLEUM prices is hardest hit by the Tax Reform Acceleration and Inclusion or Train Law.
In some areas in the country, higher ocatane gasoline and specially blended diesel have crossed the P50 per liter mark.
In a deregulated petroleum industry, market forces are left to determine gas prices. These forces include economic factors as balance of trade, foreign exchange, and of course supply prices and domestic demand. Left to market forces, gas prices go up and down. Erratic at best.
But this Train Law is self-inflicted injury. By imposing additional excise tax on fuel, prices of gasoline will inevitably increase by P10 in 2020. Diesel to escalate by P6 on two years.
Perhaps the silver lining is liquefied petroleum gas. It will only be levied an additional excise tax of P3 per kilo by 2020, P1 per kilo every year from 2018. A kilo converts to approximately two liters of LPG.
Global and domestic supplies wise, there are still abundant natural gases which the LPG is derived from. Nearby, new natural gas had just been discovered in Alegria town in southern Cebu. The contested West Philippine and our very own Benham Rise are also believdd to hold vast deposits of natural gas. In fact, these are though to be the go to areas once the deposits in the Gulf and Russia start to dwindle.
Compared to gasoline and diesel, LPG prices should be more stable, and the impact of Train, not as bad.
The Cagayan de Oro-born player in the LPG industry, Pryce Gases Inc., has been positioning well in order to provide consumers with accessible and affordable cooking gas and auto gas.
PGI has also diversified its product of late with the introduction of the LPG generator in partnership with the Italian GreenGear.
The company has also ramped up distribution of smaller, affordable Power Kalan for households who are still dependent on more expensive and dirty firewood. The company has also started phasing out metal cylinders with safer composite cylinders.
These moves are much needed as we opt for cleaner and cheaper fuel.
With its strategic positioning, it is no wonder why the company has risen to the Top 3 in the LPG industry in the country.