DOE sees oil price surges amid renewed US-Iran war

Energy Sec. Sharon Garin

MANILA, Philippines — Motorists should brace anew for a surge in fuel prices after Iran and the United States resumed hostilities in the Strait of Hormuz, a critical maritime route for energy trade.

“We [will] have increases … I think that will again spike prices more than anything else, because anything that happens there affects prices,” Energy Secretary Sharon Garin told reporters on Thursday.

Jetti Petroleum president Leo Bellas said he also expected global oil prices to go up after renewed attacks between the United States and Iran.

“The full closure of the Strait of Hormuz, with Iran threatening to attack any vessel that will attempt passage, and the possible retaliatory attacks by Tehran on energy infrastructures of US-allied Gulf states have fueled worries of severe supply disruption,” Bellas said in a message to reporters.

For Garin, the government would need to reinforce price adjustment rules only a few days after these were eased.

READ: DOE pushing for ‘aggressive’ fuel transition plan

“Yes, we have to restrict the increases again,” the Department of Energy (DOE) chief said, noting that the country’s suppliers of petroleum products may have to scramble to secure crude oil, as many of them still rely on production from the Middle East.

Effect on agriculture

“We also have to monitor the supply. We have been assured that we have suppliers, consistent [supply], as long as we have long-term contracts that they honor. But if this is prolonged, I don’t know how long everybody can sustain,” Garin said.

As of May 29, DOE data showed that the Philippines has a fuel inventory good for 45.97 days.

READ: Marcos: PH has enough crude oil supply until June 30

For Samahang Industriya ng Agrikultura (Sinag), the renewed hostilities will significantly impact the agriculture sector as local producers face higher production costs and weaker demand.

“It is a double whammy for local agriculture: producers face higher production costs while receiving lower prices for their products,” Sinag executive director Jayson Cainglet said in a statement on Thursday.

According to Cainglet, production costs of farmers and fishers have increased due to rising fuel prices, while farm-gate prices are under pressure because of weakening demand.

“While production costs continue to climb, farmers and livestock producers are seeing their margins squeezed by weaker demand and increased competition from imports,” he added.

Other factors

According to him, the situation is further compounded by tariff reductions on agricultural commodities, which further undermine the competitiveness of agricultural producers.

While the country’s annual inflation rate eased to 6.8 percent in May from a three-year high of 7.2 percent in April, continued increases in transport costs and food prices are expected to affect targets. The average inflation rate for the first five months of 2026 was already at 4.5 percent, surpassing the government’s target range of 2 percent to 4 percent.

To help offset rising production costs, Sinag called on the government to provide additional and targeted fuel and logistics support for local producers.

It said domestic procurement programs should be strengthened and institutionalized by prioritizing local farm goods in government feeding, and school and institutional purchasing initiatives. /cb