Manila, Philippines — While the tensions in the Middle East remain unresolved, global oil supply and prices remain unstable.
Whenever there are new attacks between the United States, Israel, and Iran, the Strait of Hormuz is always at the verge of being blocked and closed. It is one of the most important routes for oil and energy shipments in the Middle East.
20% of global petroleum supplies and a significant portion of liquefied natural gas, or LPG, pass through the strait daily.
While the Philippines is not directly involved in the conflict, the country continues to feel the impact of the tensions and the oil crisis.
Globally, the Philippines is among the countries that have recorded the highest increases in gasoline prices, and third in diesel prices since the tensions in the Middle East began.
This week, however, local petroleum prices saw a slight rollback amid renewed peace efforts in the Middle East.
Starting Tuesday, gasoline prices dropped by P4.70 per liter. Diesel prices were reduced by P4.30 per liter, while kerosene prices went down by P4.90 per liter.
According to former Finance Secretary and current Monetary Board Member Benjamin Diokno, the Philippine economy is no longer as vulnerable to the crisis in the Middle East.
Speaking at the Kapihan sa Manila Bay forum on Wednesday, Diokno said the Philippine economy has already adjusted to the initial wave of the Middle East crisis, giving it greater capacity to deal with its effects, including higher oil prices.
For Diokno, the government’s provision of subsidies and financial assistance to sectors directly affected by the oil crisis, particularly the transportation sector, may have also helped the country’s adjustment.
However, he clarified that financial assistance should not be the primary response to every crisis faced by Filipinos.
As an economist, Diokno said implementing a temporary fare increase for public transportation would be more helpful.
This would provide support to sectors directly affected by rising oil prices while also reducing the risk of disruptions to public transportation and the broader economy.—Mia Layaguin, Eurotv News