MANILA -- Eastern Petroleum Corp. supports the Department of Energy's plan for putting up a facility for oil stockpiling.
"The government should immediately put in place the mechanisms needed and consider stockpiling either through actual volume storage or paper placement,” Eastern Petroleum chairman and chief executive Fernando Martinez said in a statement he issued.
He noted paper placement could help the government cut costs for additional storage.
Martinez also suggests that government use the Malampaya fund or part of the reserves of the Bangko Sentral ng Pilipinas for creating a stockpile.
"If billion will be set aside by the Monetary Board as part of its reserves, similar to what it does for gold..., then the BSP could already reduce, if not erase, the deficit it has incurred in the last three years," he said.
He also said it could provide additional revenue streams for the government.
Martinez noted the country's annual consumption fell from US$ 12 billion to US$ 6 billion in the past years.
He forecasts fuel prices will likely double to $60 per barrel in the next two years, adding fuel prices will stop dropping further after it hit its 13-year low.
The chief executive also said that major oil exporting countries are already studying to maintain their production levels.
Last week, DOE Secretary Zenaida Monsada said the department tapped the Philippine National Oil Co. to conduct a study for a potential oil stockpile, which includes the volume and fuel type.
On a year-to-date basis, diesel prices decreased by P2.00 and gasoline prices by P3.45 per liter.
For international crude prices, it already fell by more than half at around $30 per barrel from $90-100 per barrel in 2014.*PNA
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