Metro Manila (CNN Philippines) — Fuel products remained cheap in 2015, but apparently, not enough to push down prices of basic items.
Many hope inexpensive fuel will reflect on retail prices.
Economists say an oversupply of oil keeps prices low despite tensions among oil producing countries in the Middle East.
A consumer group points out, retail prices are the same even with the steep drop in world oil prices from a peak of $140 in 2008 to less than the current $40.
RJ Avellana of the Union of Filipino Consumers and Commuters notes that prices of basic commodities hardly moved in the past seven years.
“So magtataka ka, kung ganon kataas ang ibinaba ng presyo kada bariles, bakit ganun katumal o napakabagal ng paggalaw ng mga pangunahing bilihin sa bansa,” Avellana says.
[Translation: “So one wonders if oil prices dropped that significantly, how come that is not reflected on the prices of basic goods.”]
Fuel may be cheaper — but not stable enough for retailers to cut prices.
Supermarket owners say suppliers who should reflect lower transport costs hardly moved their prices.
Steven Cua of the Philippine Amalgamated Supermakets Association, Incorporated says as far as retailers are concerned, they can only adjust margins.
But it seems fuel is not a major cost factor, especially for non-food products like appliances, electronics and apparel.
For these items, manufacturers usually shoulder transport expenses.
Lawyer Paul Santos of the Philippine Retailers Association says they base their pricing on how much goods are sold to them.
Delivery companies bear the cost of fuel price adjustments.
A truckers group admits that while fuel prices remain low, other factors keep them from lowering charges — like drivers’ salaries.
That, and other problems their drivers encounter on the road.
Mary Zapata of the Confederation of Truckers Association of the Philippines says mulcting traffic enforcers take a toll on their costs.
“Lalabas ka pa lang ng garahe, nakaabang na sa amin ang mga enforcers… Hahanapan ka ng violation para sa lagay,” Zapata says.
[Translation: “The moment our trucks roll out of the garage, traffic enforcers are already lying in wait to cook up all sorts of violations for grease money.”]
Agricultural products delivered to markets are most sensitive to fuel price adjustments.
As of this writing, data on how low fuel prices are reflected in the prices of produce have yet to come in.
CNN Philippines’ Ina Andolong contributed to this report.
