Fuel Prices in the Philippines Set to Rise Sharply Amid Middle East Conflict
Global oil markets are under renewed pressure as geopolitical tensions between Israel and Iran spark concerns over potential disruptions in energy supply chains. This uncertainty has led to a projected surge in fuel prices across the Philippines, with the Department of Energy and Jetti Petroleum forecasting steep increases starting next week.
Broad-Based Price Hikes Expected
Fuel suppliers anticipate notable price adjustments driven by developments in international oil trading:
Gasoline: PHP 2.50–3.20/liter.
Diesel: PHP 4.30–4.80/liter.
Kerosene: PHP 4.25–4.40/liter.
According to Jetti Petroleum President Leo Bellas, the increase stems from rising global prices caused by heightened fears of supply chain instability. Although no direct disruption has occurred, markets are reacting to the potential threat of escalated conflict in the Strait of Hormuz, a critical route for global oil shipments.
Oil Market Reacts to Escalation Risk
The conflict has triggered a risk premium across crude benchmarks, particularly Brent and WTI futures, as traders factor in possible shipping constraints and retaliatory strikes. The price volatility reflects market expectations rather than actual supply loss, underscoring the sensitivity of oil markets to geopolitical narratives. Tensions in the region have reignited fears of long-term supply insecurity, prompting rapid upward price movements. Brent crude (BRN) and WTI (CL) have both recorded weekly gains amid mounting concerns of instability affecting exports from major producers.
Inflation Pressures and Economic Spillover
The anticipated fuel price spike adds pressure to inflation-sensitive sectors such as transport, logistics, and agriculture. Diesel, vital to freight and industrial operations, is expected to see the sharpest increase, potentially driving up consumer prices and operating costs for businesses. While the Philippine peso has shown resilience against the USD in recent weeks, a prolonged conflict could intensify volatility in local energy markets and weigh on import costs. No government intervention has been announced so far to cushion the domestic impact.
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