ILOILO CITY—With rice and food prices already rising to  record levels, Energy Secretary Angelo Reyes said the country should now brace itself for rising oil prices that could reach $200 per barrel within the next 24 months.

Reyes said the $200-per-barrel price, which he said would have been dismissed as ridiculous years ago,  is now possible, citing Wednesday's forecast of the international investment house Goldman Sachs, that  which predicted the $200 price within the next 24 months.

In 2005 the investment house also predicted in 2005 that oil would reach $100 per barrel.

The  price of crude oil rose sharply to $124 per barrel on Thursday and analysts predict that it could reach $150 this year.

Reyes said the sharp rice in oil prices would have a serious impact especially on the public transport sector which mainly uses diesel fuel. He said cost of commodities and fares for public utility vehicles would expectedly also go up.

“We need to prepare (by being) more efficient (in power consumption) and to conserve energy,” Reyes said in an interview at the sidelines of a Department of Energy briefing on the power supply situation in Western Visayas on Thursday.

He said the DOE seeks to address the problem by focusing on its thrusts of increasing energy supply from local and indigenous sources and at the same effectively manage demand.

“We are aggressively pursuing efforts to locate our own sources of oil and coal, which are conventional sources of energy,” said Reyes. He said this will help being less dependent on imported sources of energy.

The DOE on Wednesday awarded five petroleum exploration contracts to oil exploration firms Miocene Mining and Energy Corp., Helios Petroleum and Gas Corp., Burgundy Global Exploration Corp. and NorAsian Energy Ltd.

Asked if removing the value added tax on petroleum products is being eyed to cushion the impact of the rising prices of oil, Reyes said this is up to fiscal authorities including the Department of Finance, Department of Budget and Management and the Central Bank.

“It (removal of VAT) will have revenue implications so it that would have to be studied by the economic managers,” he said.

Reyes announced that the DOE will conduct regional consultations this month with local officials and energy industry stakeholders to update them on the national energy situation and discuss its regional implications.

The consultations, which will be undertaken through the regional development councils, will also discuss DOE's programs and projects to address the energy concerns and needs of each region.*MPB

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