Philippines fuel prices remain high despite deal with Iran for Hormuz safe passage

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The reported guarantee by Iran of safe passage of ships bound for the Philippines through the Strait of Hormuz will not bring down fuel prices just yet, the country’s Department of Energy (DoE) admitted.

DoE secretary Sharon Garin announced that while the Philippines secured "a safe and preferential access" to the Strait of Hormuz, Filipinos should manage their expectations and accept the likelihood of more fuel price increases while the Middle East war rages.

“This development will not immediately bring down fuel prices, nor does it resolve our long-term structural challenges in energy. Those remain priorities that we continue to address," she clarified.

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The Philippine government claimed it was successful in gaining assurances from Iran that Philippine-bound ships will be allowed through the strait following a phone call between Philippine Foreign Affairs secretary Ma. Theresa Lazaro and Iranian counterpart Seyed Abbas Araghchi.

There also remains no information whether the Philippines promised Iran to remain neutral or that it would pay anything for the safe passage.

It had been five weeks since the last ship from the Middle East had docked in the Southeast Asian nation after the US and Israel initiated its war against Iran late February, prompting the latter to barricade the strait through which 20 per cent of the world’s oil and gas supply sails.

Garin explained that the country’s agreement with Iran reduces oil supply worries, not pump price problems. It will also ensure greater safety for Filipino seafarers as their ships attempt to leave the Arabian Gulf.

Meanwhile, Philippine oil retail companies have announced another P10 (62 fils) per litre hike for gasoline and P20 (Dh1.24) per litre increase for diesel starting Tuesday, April 7.

Diesel prices will reach P170/litre (Dh 10.63) from P55 (Dh3.43) since the war started on February 28.

Philippine President Ferdinand Marcos Jr. claimed last week that the Philippines has around 50 days worth of fuel supply left.