LPG Association Backs Potential Oil Stockpile

The Liquefied Petroleum Gas Marketers’ Association (LPG-MA) supports the plan of the Department of Energy (DOE) to build a crude stockpile.

“Considering the historical volatility of global oil prices, it would make sense for government to take advantage of inexpensive oil and obtain at a bargain additional fuel supplies for use in extraordinary need,” LPG-MA Paty-list Rep. Arnel Ty said in a statement.

Ty, who is also a senior member of the House Energy Committee, bared the Association of Southeast Asian Nations Petroleum Security Agreement also encourages its members to put up stockpiles.

The potential stockpile will take advantage of the current oil glut in the world market, which has caused oil prices to plunge 75 percent to USD 30 per barrel since 2014.

Some analysts also forecast that crude prices will fall to USD 18 per barrel, but will recover to USD 60 per barrel.

The House of Representatives deputy minority leader further said the association will let the DOE — through the Philippine National Oil Company (PNOC) “to ascertain the best way to build reserves.”

He also said “future supplies at a pre-determined price could be acquired on paper, without immediate physical delivery of the product.”

Ty stressed the prepared stock is “enough to protect consumers and deter potential pricing abuses.”

He cited that President Benigno Aquino III ordered PNOC in 2011 to procure 50 million liters of diesel for emergency use. It amounts to Php2.3 billion and is hoarded in two tank farms.

DOE Secretary Zenaida Monsada revealed this month that she ordered PNOC to submit a potential program for oil stockpile, which includes the volume and the fuel type. (PNA) SCS/JLD