Philippines Faces Fuel Price Hikes Amid Escalating Middle East Tension

2026-03-03 09:42:49

(MENAFN- Khaleej Times) [Editor's Note: Follow Khaleej Times live blog amid Israeli, US strikes on Iran for the latest regional developments]

The airstrikes are at least 7,000 kilometers away from the Philippines but the war in the Middle East is already impacting the Southeast Asian country in dire ways. Filipinos are bracing for a series of significant price hikes on petroleum products as a direct result of the war in the region where its oil products come from.

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The country's Department of Energy (DOE) announced a P1.90 (12 fils) spike in petrol and P1.20 (7 fils) in diesel prices starting Tuesday (March 3). The Philippines adjusts its petroleum products prices weekly and implements them on Tuesday mornings.

DOE Oil Industry Management Bureau director Rino Abad on Monday predicted a cumulative increase of at least P3.00 for petrol should hostilities in the Middle East fail to de-escalate in the coming weeks.

Tuesday's price increases would be the eighth consecutive week that petrol and ninth consecutive time that diesel and kerosene prices will increase, hiking their prices by at least P8.00 (51 fils) since the start of the year.

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Huge oil importer

The Philippines relies heavily on oil products from the Middle East for its transportation and energy requirements, importing roughly 86 to 92.5 per cent of its crude oil from Western Asia.

Saudi Arabia is the primary supplier, accounting for nearly 45 per cent of total crude imports, followed by the UAE. The country imports more than 99 per cent of its total oil requirements.

Iran's declaration of the Strait of Hormuz as a no sail zone since Sunday would impact on the Philippines' supply of petroleum products, Abad admitted, noting the Philippines only has a 30-day buffer supply of petrol and 26 days of diesel.

Abad said Filipinos have to accept the fact that oil prices would only increase in the near future unless the war in Western Asia de-escalates soon.

Fare hike or less tax?

Meanwhile, transport groups in the Philippines reiterated their demand for a P1.00 increase in fare prices for local public transportation.

The Philippine Land Transportation Franchising and Regulatory Board promised to look into their petition more seriously starting today, acknowledging the effects of the war in the Middle East.

There are alternatives to fare hikes or meekly accepting oil price increases, however, the country's largest transport group said.

The Pinagkaisang Samahan ng Tsuper at Operator Nationwide (PISTON) said President Ferdinand Marcos Jr. should stop his government's collection of excise tax on petroleum products.

The proposal, PISTON said, is a safeguard against fare hikes and general inflation brought about by unabated oil price increases.

The government imposes 12% in excise taxes on oil products, earning P400 billion (Dh26 billion) annually.

Opposition senator Francis Pangilinan agrees with PISTON, saying the ongoing conflict in the Middle East and its effects on oil prices is the opportune time to review the imposition of tax.

The Marcos Jr. government flatly rejects the demand, saying it needs the revenue to fund its social service programs. Critics, however, pointed out that the government may do away with the tax if it stops massive corruption such as the flood control scandal rocking the Marcos Jr. administration.