De Lima calls for inquiry into diesel price increase amid Middle East conflict

House Senior Deputy Minority Leader Leila de Lima on Monday sought a congressional inquiry into the extraordinary increase in diesel prices in the country amid the conflict in the Middle East, a primary source of crude oil for the Philippines.

De Lima proposed House Resolution 914, which tasks the House committee on energy and other appropriate committees to conduct an inquiry to determine why the country has emerged as among the worst affected by the current global oil shock.

She said the inquiry would examine whether existing laws and regulatory mechanisms remain adequate to protect consumers and the national economy, as well as address price vulnerability, possible profiteering, and structural deficiencies in the downstream oil industry.

De Lima said that the Senate panel inquiry on these issues already revealed estimated excessive profits of up to P3 billion daily by utilizing "replacement cost" pricing for stocks acquired before the closure of the Strait of Hormuz, rather than pricing their inventory based on original acquisition costs.

“These developments raise urgent questions as to whether the present pricing regime under the downstream oil deregulation framework sufficiently protects the public against abuse, speculative pricing, market concentration, unjustified price movements, and the full and immediate transmission of external shocks to domestic pump prices,” De Lima said.

“The extraordinary rise in diesel prices has far-reaching consequences as diesel is a critical input in public transportation, logistics, food distribution, power generation, agriculture, fisheries, and other essential sectors," she added.

"As such, there is an urgent need for the House of Representatives to determine, in aid of legislation, why the Philippines has become one of the most severely affected countries in terms of diesel prices despite being similarly situated with other oil-importing economies,” De Lima said.

De Lima also filed House Resolution 915, urging President Ferdinand Marcos, Jr., the Department of Transportation (DOTR), and the Land Transportation Franchising and Regulatory Board (LTFRB) to assess and address the impacts of rising fuel prices on public transport drivers, operators, and workers to implement a necessary and reasonable fare hike.

“A fair and sustainable fare adjustment policy must recognize that public transport drivers, operators, and workers cannot be made to solely absorb the continuing increases in fuel prices and operating costs, even as the State remains mindful of the welfare of commuters and the riding public,” De Lima said.

“A sound public policy requires considering and balancing the diverse interests, needs, and impacts of all affected stakeholders, including both the public transport drivers and workers and the commuters, while ensuring that public transport drivers, operators, and workers are given reasonable relief and can earn a just and livable income,” she added.

Fuel prices have breached P100 per liter this week, and are expected to continue rising amid the Middle East war triggered by a joint US-Israel offensive against Iran.

The joint operation was launched to supposedly deter Iran's missile program, which US and Israeli authorities deemed a threat to the region's security.

This operation has since killed Iranian leaders and prompted Iran to retaliate by launching airstrikes targeting US bases, among others, located in Middle Eastern countries where the Philippines sources 98% of its crude oil supply.

In addition, Iran has also shut the Strait of Hormuz, a major thoroughfare for the world’s oil supply.

President Ferdinand "Bongbong" Marcos Jr. has declared a national energy emergency due to the Middle East armed conflict.

Likewise, the President already signed a law allowing him to suspend or reduce excise taxes on fuel and has distributed cash aid to the public transport sector amid the rising fuel prices. —NB, GMA News