Middle East Tensions Drive Fuel Price Hikes in the Philippines

Motorists in the Philippines are facing increasing fuel costs as tensions in the Middle East continue to disrupt global oil markets. Since the second week of March 2026, fuel companies have implemented double-digit price hikes on petroleum products, sparking concern among consumers and retailers alike.

Escalation of Conflict and Initial Reactions

The price increases began following a series of escalating events in late February 2026. On February 28th, the United States and Israel conducted airstrikes against Iran, targeting locations including the capital, Tehran. US President Donald Trump characterized these actions as “major combat operations” aimed at weakening Iran’s military capabilities.

Iran responded with missile launches targeting Israel and US military bases in Bahrain, Kuwait, Qatar and the United Arab Emirates. These actions have fueled concerns about potential disruptions to oil supply routes.

Disruption of Oil Supply and Price Surges

On March 1st, shipping companies and oil producers began halting the transport of crude oil and liquefied natural gas through the Strait of Hormuz, a critical shipping corridor between Iran and Oman. Iranian forces reportedly enforced a blockade of the strait, monitored by European Union naval officials.

Approximately 20% of the world’s oil and liquefied natural gas passes through the Strait of Hormuz, making it a vital route for global energy supplies.

By March 9th, Dubai crude oil prices exceeded $100 per barrel. This led to further price hikes implemented by fuel companies in the Philippines, marking the ninth consecutive week of increases for gasoline and the eleventh for diesel and kerosene.

Impact on the Philippines

The Philippines, which imports approximately 98% of its crude oil requirements, is particularly vulnerable to these global supply disruptions.

As of March 10th, 2026, pump prices had risen as follows:

• Gasoline: ₱7.00 to ₱13.00 per liter
• Diesel: ₱17.50 to ₱24.25 per liter
• Kerosene: ₱32.00 to ₱38.50 per liter

The increase in oil prices has likewise impacted the cost of essential food commodities, including mackerel (galunggong), pork, and vegetables, with potential effects on rice prices as well.

Transport costs have also risen, with shipping companies increasing sea travel fares and the Civil Aeronautics Board raising fuel surcharges for domestic and international flights.

On March 19th, the Philippine peso weakened to ₱60:$1 amid the surging oil prices.

Government Response

In response to the crisis, President Ferdinand Marcos Jr. Ordered a four-day workweek in selected executive offices to conserve energy. Some government offices, including the judiciary, adopted similar measures.

The government has also taken the following steps:

• The Philippine National Oil Company–Exploration Corp. (PNOC-EC) is seeking to secure at least two million barrels of oil to boost the country’s buffer supply.
• Energy Secretary Sharon Garin assured the public that the country has sufficient fuel reserves, expected to last up to 50 days.
• President Marcos certified as urgent a bill granting him emergency powers to suspend or reduce excise taxes on fuel, which was subsequently approved by the House of Representatives.
• Fuel assistance has been provided to public utility vehicle (PUV) drivers and farmers, including a ₱5,000 cash subsidy for tricycle drivers in Metro Manila. A nationwide rollout for other transport groups is scheduled for April 6th.
• The Department of Agriculture is set to distribute ₱5,000 fuel subsidies to 9,570 farmers and additional aid to 15,000 fisherfolk.

Initially, the Land Transportation Franchising and Regulatory Board approved a ₱1 fare increase for traditional jeepneys, but President Marcos ordered its suspension to protect commuters.

Some gasoline retailers have reported limited diesel supply, with several stations adjusting work shifts and others considering temporary closures if the situation does not improve.