Going after Fuel Peddlers

GOING AFTER FUEL PEDDLERS
Ditas A. Garcia

Bote-boteng diesel costing significantly lower than its service station equivalent is a common sight in Pampanga. It poses a growing threat to the province's legitimate petroleum retailers. Jeepneys and tricycles queue up along sidewalks and small stalls, in jeepney and tricycle terminals to buy this latest version of "mineral gasoline/diesel."

With sales of service stations taking a dip from unrestricted competition from ambulant vendors, petroleum retailers in Pampanga lost no time addressing the complex problem. In the forefront is the Petroleum Dealers Association of Pampanga (PDAP), a two-year-old organization composed of 60 members from the oil majors and TOTAL, and chaired by

Caltex retailer, Nazareth Tuazon. So far, their initiative to ban fuel peddlers has taken them to San Fernando Mayor Rey Aquino and to public hearings with the City Councils of San Fernando and Angeles. Supporting their claim that peddling fuel compromises the public's health and safety were Director Zenaida Monsada of the DOE's Energy Industry Administration Bureau and officers of the Federation of Petroleum Dealers of the Philippines.

The significant issues raised during the hearings were:

1) The PDAP does not intend to suppress competition but merely seeks to level the playing field. Service stations are at a clear disadvantage when it comes to pricing since peddlers can operate without permits, fire safety certificates, fire extinguishers or clearance from the DENR. In addition, the peddlers' supply sources are unidentified and may include smuggled or pilfered fuel products.

2) The public should know that petroleum products are harmful to health if not properly handled and stored, affecting not only vendors but also the customers. For example, selling bottled fuels next to fruits and other foodstuff is definitely harmful. So are petroleum storage tanks that are hidden in houses. Loading fuel from bottles is likewise unsafe because of a tendency to inhale fumes.

3) PDAP and DOE warn that, despite diesel's high flashpoint, uncontrolled peddling of diesel fuel is unsafe because of spillages that may pollute river systems and deep wells, affecting the community's health.

4) Effective Government control over product quality and quantity of mobile peddlers is simply not possible, depriving the public of adequate safeguards. For example, a gallon of diesel purchased from the peddlers measured only 3.75 liters. In contrast, service station pumps are regularly calibrated by City Hall and products regularly checked by retailers and DOE for adulteration.

5) Fire incidents are likely to occur due to absence of safety hazards. Smuggling and pilfering tankers will increasingly become a lucrative activity. Legitimate petroleum dealers are likely to find it untenable to survive the competition, affecting Government revenues from permits and income taxes.

PDAP's move is certain to start the process of reforming the industry. At the very least, we can now expect the DOE to fast-track the industry guidelines that should enable the local government units to act judiciously on applications and complaints. Hurdling the other dimension of the problem -- the tendency to view this initiative as anti-poor -- is more difficult to address. As one vendor indicated to the Permits Inspector in Pampanga, "Kung tatanggalin ninyo ito, anong magiging trabaho namin?"

A challenging task faces the legitimate players of the industry but we will just have to take it a step at a time, the way PDAP has done.

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