The price of diesel could reach as high as P90 per liter this month if the conflict in the Middle East persists, the Department of Energy (DOE) said.

During the Senate Committee on Foreign Relations hearing, DOE Oil Industry Management Bureau (OIMB) Director Rino Abad explained that the potential impact on consumers will depend on how oil companies implement price adjustments.

When asked about the possible effect the hostilities would have on local pump prices, Abad said DOE estimates showed diesel prices were already approaching P80 per liter based on recent international movements.

“Mr. Chair, ngayon ha yung apat na araw, ang estimate namin ha, nasa P79 na yung pump price to almost P80 na (Mr. Chair, as of now, based on the past four days, our estimate is that the pump price is already at around P79, or almost P80),” Abad said.

"From the P61 na pump price nung diesel, P62, plus the P17, almost P18, kaya maabot po nang almost 80 (From the P61 pump price of diesel—P62—plus the P17 to almost P18 increase, it could reach nearly P80),” he added.

With this, Tulfo asked whether or not fuel prices could surge further if the conflict continues.

He reckoned that if the conflict does not stop, there was a strong possibility that within the month, diesel prices could reach around P90 per liter, while gasoline could climb to about P80 per liter.

In response, Abad declined to provide a firm projection but acknowledged that similar levels had been reached during past geopolitical tensions in other countries, particularly the Russia-Ukraine war, where diesel prices reached P90 per liter.

But he noted that the current crisis was "worse" than that, given that it involved the Middle East.

Abad also emphasized that oil prices remained highly volatile and difficult to predict. He noted that movements often depend on "signals" and developments in global markets.

The DOE is encouraging oil firms to spread out the adjustments to ease the burden on motorists.

“Kung mag-implement lang sila, spread out nila for two weeks, then kalahati lang po nung 18 pesos na increase supposedly dun sa diesel ang may implement, mga P9 (If they implement it, they can spread it out over two weeks. That way, only half of the supposed P18 increase for diesel would be applied at first, around P9),” Abad said.

In that scenario, diesel prices would rise more gradually.

He noted that developments such as statements from the United States (US) or signs that the conflict was easing could quickly affect price trends in the international oil market.

Assistant Secretary for Road Transport and Non-Infrastructure Dioscoro Reyes confirmed that the Department of Transportation' (DOTr) plans to recommend a fuel subsidy from the contingency fund of the President immediately after the hearing.

“Immediately po after the hearing,” Reyes said.

Tulfo noted that the subsidy would to lessen the impact on public transport drivers, operators, and commuters.