MANILA - Deregulating the oil industry has its downside—it has encouraged smuggling owing to the higher illicit profits to be made with oil surreptitiously brought in.

This is the contention of Ramon Ang, chairman of Petron Corp., in the face of the clamor to regulate anew the oil industry due to the perceived overly high prices of fuel.

“The smuggling of gasoline and diesel started when the industry was deregulated, as it allowed any Juan de la Cruz to import gasoline and diesel,” he said in a meeting with journalists the other day.

He added one could “instantly be an overnight [peso] billionaire” with smuggling, especially since the smuggler pays no taxes.

Ang said an earlier study of the industry showed that 30 percent to 35 percent of the fuel sold locally are now sourced from oil smugglers, and the study noted the government as a result loses P30 billion to P35 billion in taxes.

“Those are not just mere speculations; the study has bases to be able to detail how many liters and where the importers source their supply. The suppliers and traders know each other very well. Those who made the study got hold of the records the government could not find,” said Ang.

“If I say I’m not in favor [of regulation] they may get mad. They can do whatever they want and we will play the game whatever game they have any time,” he added.

But he called attention to the difficulties in reverting to a regulated regime “supply, piers, and tanks are everywhere the whole country making it difficult to control. . .and there are gas stations everywhere.”

“Given the situation, there is a need to apprehend smugglers. But the question is, are we good in [preventing smuggling and catching smugglers], is the Philippines good in that? asked Ang.