RP tries to deal with oil price hike

RP tries to deal with oil price hike

MANILA: President Gloria Arroyo has ordered a "contingency
plan" drawn up to explore the Philippine government's options
should there be further rises in oil prices, which have spurred
street protests and boosted inflation, her spokesman said on
Wednesday.

"This contingency plan ... is calibrated to deal with the
risks depending on the level of oil prices," said presidential
spokesman Ignacio Bunye.

Energy Secretary Raphael Lotilla will submit the plan to
Arroyo "in the next few days," Bunye said.

The government lost its power to dictate pump prices after
Congress passed a law deregulating the oil sector in the 1990s.

Arroyo had told the energy secretary that the most important
thing was to look into whether the three main oil companies in
the country were acting as a cartel in setting fuel retail
prices, Bunye said.

On Monday, a massive transport strike, called to protest the
almost weekly increases in oil prices, stranded tens of thousands
of commuters in major Philippine cities.

There are concerns that oil price increases may cause the
inflation rate to exceed government projections, straining the
resources of an administration that is already struggling to keep
the budget deficit under control. -- AFP