Here's why fuel prices are still rising, and what we can do to save in the meantime
The Philippines is about to experience its tenth week of rising fuel prices, with oil companies planning further hikes as world markets continue to reel on the heels of Russia's invasion of Ukraine.
Economic tensions, inflation, and the pandemic have all played a hand in the rising prices, but the recent Russian invasion has sent global crude oil prices soaring after international sanctions were imposed in response to Russia's invasion.
With Russia being one of the biggest oil and gas producers in the world, the world oilmarket has been directly affected, with the impact acutely felt for a net importing country like the Philippines.
This week alone, oil companies have raised gas prices by P1.2/liter, diesel by P1.05/liter, and kerosene by P0.65/liter.
How is this being dealt with?
In response to the crisis, the House of Representatives has gathered a "fuel crisis ad hoc committee" to look into the measures being floated to the government to alleviate the gas prices.
During their first hearing on March 7, the Department of Energy (DOE) regulations tackled the review of the oil deregulation law or Republic Act 8479 and the reduction of excise tax. As of writing, the country's excise tax is at P10/liter for gasoline, P6/liter for diesel, and P5/liter for kerosene.
The agency added that the country isn't experiencing a supply issue, but rather one of pricing and deregulation.
"The problem is the pricing," DOE Undersecretary Gerardo Erguiza said. "We want government interventions whenever there is an increase in oil prices. The root of all these problems is oil deregulation."
What will prices look like soon?
During the ad hoc meeting, Erguiza also shared a forecast for the gas prices in the next few weeks if the crisis continues.
At its highest Dubai price projection at $120 per barrel, the DOE predicts that fuel could reach up to P78.33/liter for gasoline, P68.97/liter for diesel, P71.21/liter for kerosene, and P107.0/liter for LPG.
"Hindi po natin alam ang development, but that is the original projection based on circumstances dito sa mundo," Erguiza said.
DOE also said that hikes at these levels were last seen in August of 2014, when Russia was similarly sanctioned by the US and Europe for its annexation of Crimea, and further tightening could be in place.
"Given the high dependency of Europe on Russian oil and gas sector and already tight state of the oil markets, any sanctions affecting payment transactions would further tighten the oil markets," the March 1 DOE oil monitor read.
How can we save in the meantime?
Public transport groups are urging the government to expedite fuel subsidies for drivers and operators of public utility vehicles amounting to P6,500 per individual.
Meanwhile, the DOE recommends private motorists to avail of gas station discounts and promotional programs:
- Shell is offering fuel discounts as rewards through their Shell Go+ app and loyalty program.
- Members of mega retail establishment Landers can get a discount with Caltex if they avail of the Caltex StarCard. Caltex's other loyalty cards can be found here.
- UniOil is offering the Unioil Classic Loyalty Card with discounts up to P2/liter on diesel for participating branches.
- Shell, Petron, and UniOil also have official Shopee accounts that can curb the check-out price once vouchers and promo codes are used.
What about other goods?
Department of Trade and Industry (DTI) Spokesperson Ruth Castelo on March 7 said that, unlike fuel, prices of the country's basic commodities won't immediately increase.
"Kahit sa ayaw natin o sa gusto, magkakaroon at magkakaroon po ng impact satin. Pero hindi 'yan immediate. Sa ngayon, we're looking at the next three months bago mag epekto yung nangyayari sa Europe," Castelo said.
"We have enough supply, hindi kailangan magpanic ng tao and we're also tempering kung meron mang price increase."