The government is ready to use its full powers and prosecute oil companies who would violate a temporary price freeze on oil products in Luzon, Malacañang said Monday.

Executive Secretary Eduardo Ermita said the Department of Energy and the Department of Justice have been mobilized to exhaust their powers to ensure that oil companies comply with Executive Order No. 839 freezing fuel prices to October 15 levels.

The EO, signed by the President last Friday, will be in effect until the state of calamity in Luzon is lifted. The order cited a provision in the oil industry deregulation law that allows the DOE to temporarily take over or direct the operations of players in the oil industry in case of an emergency.

To avoid possible lawsuits from government, Ermita appealed to oil companies, particularly market leader Petron Corporation, to follow EO 839 and consider the welfare of calamity victims before their profits.

“We have directed the DOE and DOJ to inform oil companies that the government is not without power to regulate when the interest of the greater majority is at stake,” Ermita said in a radio interview.

“We can prosecute them,” he added, referring to oil companies violating the latest presidential directive.

So far, only UniOil has slashed the prices of petroleum products by as much as P2 per liter in compliance with EO 839. The other oil companies are reportedly still studying the President’s order while others are planning to take legal action.

Ermita said acting Justice Secretary Agnes Devanadera has vowed that she will not hesitate to collate evidence and file charges against erring oil companies.

“We hope it would not reach to the point where the justice department will open the books of the oil companies to determine if they are following EO 839,” he said.

Ermita said Petron should even lead the big oil companies in adhering to the price controls while Luzon is under a state of calamity. Ermita said he plans to call top executives of Petron to show a "good example" considering that the oil firm is partially owned by the government.

“Kung ang isang oil company katulad ng Unioil nakikita nila na kinakailangan talaga na maki-cooperate sila not so much for their own goo but for the good of many, sa palagay ko naman ay walang dahilan kung bakit iyong ibang oil companies ay hindi naman susunod din,” he added.

In issuing EO 839, Ermita explained that the President wanted to protect consumers from illegal profiteering of oil companies especially since many parts of Luzon are still struggling to recover from the devastation from two killer typhoons.

Deputy Presidential Spokesman Anthony Golez, meantime, said the government finds no conflict between EO 839 and the Oil Deregulation Law.

Golez said the deregulation law actually allows the DoE to manage petroleum prices in times of national emergency to protect public interest. He said they expect Energy Secretary Angelo Reyes to meet with oil companies regarding compliance to the EO.

Earlier, Malacanang said the government is unlikely to take over the operations of erring oil companies despite violations to the presidential directive.

Prior to EO 839, the President instructed the DoJ and DoE to run after oil companies engaged in predatory pricing, unreasonable pricing and cartelization. She said the two government agencies should exhaust its powers to open the financial books of oil companies to see whether their prices reflect market levels.

Reyes has objected to the imposition of a price ceiling on petroleum products, saying it would affect supply and eventually do more harm to consumers.

Aside from Petron, major oil players Pilipinas Shell and Chevron Philippines are likewise twiddling their thumbs on EO 839.

The three oil firms even announced that a price hike of P1.50 per liter was to be implemented this week, something that was “justified”, according to Reyes.

International prices of gasoline have gone up by $4.50 a barrel while diesel climbed $6.50 a barrel, the oil companies have noted. But the EO derailed their plans for a hike, which would have been the third this month.

At 10 p.m. Sunday, Unioil slashed the prices of its diesel by P2 a liter; unleaded gasoline by P1.25; regular gasoline by 85 centavos and kerosene by P1.50, Corporate Communications Officer Leah Flor said.

“We want to exercise this as part of our corporate social responsibility,” said Unioil General Manager Chito Medina-Cue Jr.

Although not yet lowering its prices, small player Flying V acknowledged the need to ease the burden on the typhoon victims.

“It is a form of sacrifice on our part to help our countrymen who were adversely affected by typhoons,” said company Vice President Jose Victor Cruz.

Chevron, for its part, said it would first study the possibility of reducing prices.