The DoE is reviewing the pricing mechanism as fuel prices may increase to P10/L
By Sheldeen Joy Talavera again Erika Mae P. Sinaking, Journalists
The Department of Energy (DoE) will meet on Friday to review its fuel price regulations as the price of diesel is set to increase by P10 per liter (L) next week after the outbreak of tensions in the Middle East has raised concerns about global oil availability.
“[The single pricing adjustment] we will be followed,” Rino E. Abad, director of the DoE’s Oil Industry Management Bureau told reporters Thursday. “We will hold a meeting tomorrow.”
The agency is considering changing its practice of announcing weekly fuel price changes with one fixed adjustment during market volatility.
Energy Secretary Sharon S. Garin previously said the DoE plans to set a firm price adjustment rather than a flexible range.
“Since prices still seem to be very volatile, we have decided here at the DoE that next week, we will set a specific number, there is no longer a range,” he told a news conference.
After three trading days used to calculate next week’s gasoline prices, diesel prices are expected to increase by P9 to P10 per liter, according to industry figures.
The price of gasoline may increase by P3.50 to P4.50 per liter.
“World oil prices have increased significantly this week due to renewed conflicts in the Middle East, reviving supply concerns as shipping in the Strait of Hormuz has decreased significantly,” said the President of Jetti Petroleum, Inc. Leo P. Bellas in a Viber message.
The Strait of Hormuz carries about a fifth of the world’s oil exports, making any disruption a major driver of crude prices.
Top Line Business Development Corp. Senior Vice President and Chief Operating Officer Brigitte Carmel C. Lim said local pump prices may continue to rise if higher global prices persist.
“That said, it’s too early to say we’ll see double-digit growth,” Viber’s message said. “Much will depend on how the situation starts and whether tensions continue. For now, we are closely monitoring the market and we hope that the country’s risks will ease to help stabilize oil prices.”
As of Tuesday this week, the DoE ordered oil companies to adjust gasoline prices within a P1-per-liter retreat range to increase by P1-per-liter, while diesel and kerosene prices were allowed to increase by about P4.62 and P4.22 per liter, respectively.
As a result, gasoline prices in Metro Manila and nearby areas have increased to P96.10 per liter, while diesel now fetches around P90.77 per liter.
If the increase expected next week goes through, the prices of gasoline and diesel in Metro Manila and nearby areas could exceed P100 per liter.
HELP PRAYED
Also on Thursday, President Ferdinand R. Marcos, Jr. announced the expansion of the government’s Livelihoods, Industries, Food and Transportation Assistance Program to help mitigate the impact of high fuel prices and inflation related to the war in the Middle East.
“We continue to feel the effects of tensions in the Middle East, which threaten global oil supplies,” Mr Marcos said in a pre-recorded message in Filipino. “This affects our economy and prices.”
Under the expanded program, about 1.5 million low-income workers and their families registered with the Social Security System will receive P2,000 per month from July to December.
Another 2.5 million poor and near-poor households identified through the 2024 community-based monitoring program will receive the same monthly assistance during that period.
The government will also provide an additional one-time grant of up to P2,000 to P3.5 million to beneficiaries of the Pantawid Pamilyang Pilipino Program and the Walang Gutom Program.
The expanded program is expected to benefit about 7.5 million families, or about 37.5 million Filipinos.
“Our mission is to protect the ability of Filipino families to meet their daily needs,” said Mr. Marcos. “At the same time, we have expanded the provision of aid so that more Filipinos can benefit from this program.”
Palace Press Officer Clarissa A. Castro said the Department of Budget and Management has issued an order for the release of the P12.375-billion special allocation and the notice of appropriation to finance the increased aid.
“The source is provided for savings under National Budget Circular No. 602 and 603 as approved by the Office of the President,” he told a Palace briefing in Filipino.
Asked why the government does not provide direct financial assistance to low-income taxpayers, Ms. Castro said the administration is prioritizing vulnerable sectors while seeking to prevent fare and commodity price increases.
“The thing we hope to avoid right now is a sudden increase in fares,” he said. If transport workers get help, everyone benefits because fares and freight prices won’t go up any time soon, he said.
He also added that vehicles transporting essential services continue to receive government support, including toll-related compensation, to help contain transportation costs.
The Philippines imports almost all of its petroleum needs, leaving domestic pump prices highly sensitive to changes in global crude prices.
Mrs. Castro said the government will continue to test its financial strength if the conflict continues.
“If there is a budget available, it will be released immediately to help those who need it most, while the government continues to balance its resources,” he said. “We don’t know what will happen in the coming days. The situation might get better.”
