Photo courtesy of Joan Bondoc- Philippine News Agency (PNA).
Once again, motorists face the prospect of another steep fuel-price increase next week as renewed escalation in the conflict between the United States and Iran sends crude oil prices soaring and threatens to disrupt global petroleum supplies.
On Thursday, Brent crude breached the US$100-per-barrel mark on Thursday, reflecting growing market concerns over the security of oil shipments passing through the vital Strait of Hormuz.
The spike comes only days after local pump prices were raised sharply, effective last Tuesday, September 8, with diesel prices increased approximately by P5.18 a liter and gasoline by about P4.69 a liter.
According to the Department of Energy (DoE)’s price calculations, preliminary estimates of the fuel hike this coming September 15 has placed the possible increase at P3.50 to P4.50 a liter for gasoline and P9.50 to P10.50 for diesel.
However, the projected figures are not final as they could still move significantly depending on international refined-product prices and the peso’s performance against the US dollar during the remainder of the pricing window.
In any event, diesel—the primary fuel used by most public transport—could bear the heavier burden as supply disruptions and stronger refining margins add to upward pressure on the fuel.
The expected large fuel price increase comes at a difficult time for motorists and transport operators, who have to absorb higher operating costs. Likewise, businesses dependent on road transport would also have to face increased delivery and logistical expenses.
But economists claim that the broader concern in the development is inflation and a prolonged rise in petroleum prices xould eventually translate into higher transportation and production costs, thus placing additional pressure on household budgets.
“Much will depend on whether the latest US-Iran confrontation produces a sustained disruption in oil supplies. Until then, motorists can expect heightened uncertainty at the pumps, with next Tuesday’s adjustment likely to be closely watched by consumers, businesses and policymakers alike,” they pointed out.
