So Insensitive
THEY come in the wee hours of the morning, without ample warning, as we’re in our homes fast asleep after a long week at work. We’re not talking about thieves in the night, but they might as well be, considering how much they take away from our hard-earned incomes.Since the Downstream Oil Industry Deregulation Act took effect more than a decade ago—and especially lately with the record crude prices worldwide—retailers have been raising prices at the pump when we are at our most vulnerable.
Their announcements—if we could call them that—hardly reach the public to be of any practical use. If at all, they would be aired during the late night TV news or barely 30 minutes before midnight, by which time most of us are already in bed and too beat up from a week’s work and the Friday traffic to have the energy to get up and drive to the nearest station to gas up.
For all the discomfort they’re causing commuters during transport strikes, we must hand it to public utility vehicle operators and drivers because they have the decency to announce their plans way ahead of time. At least people could plan their lives accordingly.
We can say the same about labor unions, which are required by law to file the necessary papers with the government before they embark on work stoppages. Not that we’re great fans of these two groups, but the antiquated restraints imposed on these factor markets betray the free-market ideologists’ bias for the powerful when it comes to sectors such as the downstream oil industry.
The underhandedness exhibited by oil companies is so insensitive coming at this time when very expensive oil products are causing inflation to shoot up again, raising fears that incomes may be slow in catching up to the erosion in people’s purchasing power.
What difference would it make for companies if they announce their price increases early in the evening, giving motorists enough time to pass by a station along the way home to gas up? Apparently it means a whole lot for their margins, as they would rather surprise most of us the following morning.
What we find so intriguing is that whereas multinational oil refiners had reported record profits last year, their local units and affiliates said their earnings barely rose from the previous year. And we hear this at a time when oil products are at their most expensive in history—and still rising, judging from the unabated increases in the futures markets.
The sad part is that the downstream deregulation law took away whatever legal remedies past edicts provided consumers. The 1998 law even emasculated the government, which has been reduced to a bean counter, tallying price changes after the fact. The operative word, according to the law, is “price monitoring.”
True, the law banned a handful of anti-competitive offenses to prevent price collusion, but oil companies have found a way around these practices. The law also gave the Department of Energy certain powers it could exercise in such circumstances, but left it to the local courts to deliberate on the matter. As it is, the courts are already clogged up with other pressing cases, so ordinary consumers are left to their own devices. Once again, the free-market ideologists have betrayed the lot of their unsuspecting middle-class supporters.
Despite the limitations set by law, we’re still waiting for the incumbent energy secretary to make good on his bluster when he took office. Last year, he had warned oil companies to comply with a directive to inform the department of price adjustments. Moreover, he announced a government plan to audit oil companies, tapping the services of a third-party service provider.
We’re well into a new year, and we’ve yet to hear anything come out of those initiatives. So, Mr. Secretary, we’re still waiting.
