.
They created oil deregulation because the government had no enough money that could subsidize the oil prices. 8.
B. Why is there a need to deregulate the oil industry?.
The government's reason why there is a need to deregulate the oil industry is because we lack budget for it that would subsidize the oil prices when it increases. The money that is used to subsidize the prices is from the taxes.9.
The World Bank, whom the Philippines owed a billion dollar of debts, is trying to ask for the payment of these debts.10 .
The government says that the only chance to develop the Philippine economy and to pay for all the debts the country had from the World Bank is through deregulating the industry.11 .
Another thing is the money that is used to subsidize the oil prices, will be used to pay the debts and other significant infrastructures such as government offices, school buildings, bridges, roads and hospitals.12.
According to the National Economic Development Authority or N.E.D.A., the total money that is use to subsidize oil prices can create 16,000 housing units, 4,000 km of provincial roads, 51,000 deep wells, 25,000 school houses and free rice for the 20% poorest Filipinos for a year.13.
The Philippines is a minor oil producer but one of the most major oil consumers in the world and the country's gas sector has not yet been developed extensively.14.
According to the energy review done by the Department of Energy, the country produces 8,460 bbl per day, but consume 356,540 bbl per day as of 2001.15.
In order to meet the demands for Petroleum products, the country needed to import oil from other countries. As of 2001, the country's net oil import was 347,540 bbl per day.16 If there is deregulation, there will be fewer rules to follow since the government cannot interfere anymore. .
Another reasons why is there a need of deregulating the oil industry is that the money used to subsidize the original price is from the people's taxes.
