Shell reviews biz plan due to Middle East crisis

MANILA, Philippines - Pilipinas Shell Petroleum Corp. said it is reviewing and updating its business continuity plan in view of the increasingly volatile political situation in the Middle East, particularly in oil-rich Libya.

In the meantime, the Department of Energy (DOE) has assured it has a national contingency plan to address any oil supply shortage.

Shell vice president for communications Roberto Kanapi told reporters that the Philippines remains vulnerable to political developments in the oil-producing countries, being a net importer of crude oil.

But Kanapi assured that Shell and the other oil players have contingency plans to address any threat to the country’s oil supply.

“Due to the ongoing tension in the Middle East, we have tasked our businesses to ensure that contingency plans are kept updated to ensure continued delivery to meet our customers’ needs,” Kanapi said.

Shell’s existing supply structure, including management of supply contracts, provides the company a considerable degree of flexibility to ensure supply continuity.

Nonetheless, Shell, the second largest supplier of petroleum products in the Philippines, said it continues to monitor events to ensure that contingency plans are in place to prepare in the event the country faces an emergency situation.

Part of its mitigation measures include maintenance of minimum product inventories as required by the Department of Energy (DOE) and securing assurances from its existing suppliers to ensure an equitable allocation of petroleum products.

“As we continuously support government’s efforts to ensure oil supply security, we also encourage the public to join in our advocacy for efficient energy management. There are various ways by which we may contribute towards this end, including energy conservation, use of fuel economy products, and smart driving behaviors which help optimize fuel economy,” Kanapi said.

Just the other day, oil players jacked up their pump prices by a minimum P1 per liter up to a maximum of P2 as prices in the world market becomes volatile. Tension in the oil-producing states, including the Middle East, have inflated prices to over $100 per barrel.

Meanwhile, Energy Secretary Jose Rene Almendras said the DOE has in place contingency measures in the event of a fuel supply shortage.

In an interview over national television, Almendras revealed that they have asked all oil players to make an inventory of their supply, both for those already in their possession and in transit.

“As part of our preparations, we should increase supply,” he said, adding that they want to increase supply beyond the normal levels. Normally, the country has up to three months combined supply on hand.