MANILA — The Department of Energy is not dismissing the possibility that the price of diesel will reach more than P80 per liter this month if the war in the Middle East drags on and if the oil increase will not be done on a staggered basis.
DOE prepares for worst-case scenario as Middle East war drives fuel costs
During Friday’s hearing of the Senate Committee on Foreign Relations on the safety of Filipinos in the Middle East, committee chairperson Sen. Erwin Tulfo also asked about how the war would would affect petroleum prices.
“Yung Ukraine-Russia...umabot po tayo ng mga P90 kasi. Ayoko po mag-project pero ito’y mas masama pa doon eh kasi ito Middle East ang pinag-uusapan,” DOE Oil Management Bureau Director Rino Abad said.
“Kung mag-implement ang staggered, hindi masyado abot kaagad. Pero kung one time bagsakan, pwede yung umabot na po,” Abad said. “To be safe, pang above P80 po."
Abad said that on February 27, gasoline cost P54 per liter while diesel was at P60 per liter.
DOE estimates the price of gasoline to reach up to P70 per liter in March if not implemented on a staggered basis.
“For the longest time, inemphasize natin na ginawa na ito before na nag-staggered price adjustment ang mga oil companies. In the case also of Ukraine, Russia,” Abad said.
According to Abad, the country’s oil supply will be safe until April 15. The DOE will meet with oil companies next week to follow up on the replenishment of supply from April 16 onwards.
“Pinapabili na rin ni secretary ang PNOC ng inventory standby reserve. Up to 1 million barrels of reserve. So lahat ito, lahat ina-access natin yung anticipation,” Abad added.
Asked about the possibility of rationing, Abad said that is always a part of the contingency plan.
What's the difference between excise tax and VAT - and why we pay both
Department of Transportation Assistant Secretary Dioscoro Reyes said they will immediately recommend to President Ferdinand Marcos Jr. the release of a fuel subsidy from the Contingency Fund.
Energy Regulatory Commission (ERC) Executive Director Nancy Fajardo, meanwhile, said the increase in prices of petroleum products will also affect the price of electricity.
“Based on experience, what happened in 2022, and initial simulations from the market operator, definitely po meron po yung epekto sa generation charge or sa generation rate. So maapektuhan po yung presyo din natin ng kuryente,” Fajardo said.
“Kahapon po mineet ng Energy Regulatory Commission yung Independent Power Producers Association and in-assure po nila yung ERC na meron pa po tayong sapat na supply, lalo na po merong variable (renewable energy) capacities tayo," Fajardo explained.
"So during the day, ano naman po yun, enough daw po to cover yung mga requirements. Pagdating po ng peak hours, yung hindi na magagamit yung variable RE, dun po maaaring mag-spike yung presyo natin,” she said.