President Ferdinand R. Marcos, Jr. has ordered government agencies to drastically cut electricity and fuel consumption as the Middle East war threatens global energy supplies and the threat of shortages in the Philippines increases.
In a statement, Executive Secretary Ralph G. Recto said compliance with the directive is mandatory across the bureaucracy, including state-owned and controlled companies. These measures are aimed at curbing demand as supply chains remain vulnerable amid the Iran war.
Mr Recto said energy monitors had inspected more than 1,000 government offices in the first week of enforcement. Air conditioning usage, lighting, and office equipment were examined, as the administration emphasized immediate and measurable reductions in consumption.
Under the order, agencies will have to limit power usage, while fuel consumption is being curbed by restricting the use of government vehicles. Only vehicles designated for public safety, emergency response and health services are exempt.
Mr Marcos also ordered energy-saving measures linked to the Philippines' hosting of the Association of Southeast Asian Nations (ASEAN) this year. Spending has been cut, meetings have been reduced and non-essential programs have been cancelled.
The President said ASEAN activities would be “dumb”, with discussion focusing on oil prices, food costs and migrant workers. The ASEAN summit scheduled for May will go ahead.
Earlier this month, the executive branch shifted to a four-day work week as part of conservation efforts. The Senate adopted five days of work from home, while the House of Representatives implemented a hybrid arrangement with three days onsite and one day remote. Malacañang said private companies can also adopt similar measures, similar to the policies used during the COVID‑19 pandemic.
The Philippines is in a year-long state of national energy emergency – the first such declaration globally – as the country faces the threat of disruption in fuel supplies. As a net oil importer, the Philippines is highly affected by global price fluctuations.
Fuel prices have increased, causing food and transportation costs to rise. Economic Planning Secretary Arsenio M. Balisacan warned that a continued rise in oil prices could push inflation beyond the government's 4% target and hurt economic growth.
Congress has granted Mr. Marcos emergency powers to cut or suspend excise taxes on fuel, though analysts have said the impact on pump prices may be limited.
Meanwhile, the government has introduced fuel and cash subsidies to ease the impact on vulnerable sectors, including transport workers and low-income households.
Meanwhile, Senator Paolo Benigno A. Aquino IV has filed a bill that seeks to classify petroleum products as basic necessities, a move that would allow the government to intervene in fuel pricing amid rising costs.
Mr. Aquino, in the explanatory note to Senate Bill No. 2011, which would amend Republic Act No. 7581 or the Price Act, said the law fails to address gasoline and diesel as major drivers of inflation because these remain unregulated.
“The Philippines is in the midst of a fuel price crisis, and Filipino families are feeling the strain,” he said in a statement. “Rising diesel and gasoline prices have driven up transportation costs, food prices and the cost of basic goods.”
The proposal would expand the list of basic requirements to include petroleum products, giving the government the power to impose price caps during emergencies. There is also a provision to increase the period of government price control from 15 days to 30 days.
Mr. Aquino said workers, small business owners, farmers and ordinary families are bearing the brunt of higher fuel costs, which is impacting the entire economy.
Under the Price Act, only liquefied petroleum gas and kerosene are classified as basic necessities. Mr. Aquino said the law no longer reflected the composition of household and business expenses.
He also urged economic agencies to reconsider the 12% value added tax (VAT) on fuel. Mr. Aquino said suspending VAT could lower pump prices by about P20 per liter.
He pointed out that this is one of the fastest tools that the government can use to reduce the burden on consumers.
Following the escalation of the war between the US, Israel and Iran, several fuel-related bills have been filed, including proposals for a National Petroleum Reserve, amendments to the Biofuels Act, and repeal of the Oil Deregulation Act.
Fuel prices have risen sharply, with diesel at P144.20 per litre, gasoline at P102.50 and kerosene at P166.
The Energy Department said fuel reserves would remain sufficient through the end of April, while Acting Secretary Ralph G. Recto said 1.04 million barrels of diesel was scheduled to arrive this week. — Chloe Marie A Hufana And Calla Patricia B. Gabriel