Energy Secretary Sharon S. Garin said the Philippines has limited ability to control fuel prices under its deregulated oil industry, as global market forces continue to drive local pump prices.

In an interview with ABS-CBN News’ ANC, Garin said fuel prices in the country are dictated by international markets, leaving the government with little room to directly intervene.

“Basically the price we cannot control. The international market dictates us,” she said.

Garin emphasized that under the current framework, the government cannot set or dictate prices for diesel and gasoline.

She noted that while deregulation allows market-driven pricing during stable periods, it also limits the government’s ability to respond during times of crisis.

“It’s okay if the price is okay, but in bad times you need to have certain powers over that,” Garin said.

She added that the government may need to consider strengthening its regulatory tools, particularly during periods of volatility in global oil markets.

Garin also pointed out that other countries in the region provide subsidies or have access to domestic fuel sources, while the Philippines has limited resources, citing Malampaya as its only major local energy source.

“We don’t have that yet… we only have Malampaya, which is gas,” she said.

Despite these limitations, the government can still act against practices such as hoarding and profiteering.

“We do have powers… over profiteering and hoarding. And that’s something that we can, we are already imposing,” she said.

Instead of direct price control, Garin said the government is focusing on measures to cushion the impact of rising fuel prices, including targeted subsidies and the possible reduction or suspension of excise taxes.

“We buffer the impact through targeted subsidies and hopefully with the reduction of excise tax also,” she said.

She noted that the effects of rising fuel prices are most evident in transportation and the movement of goods, which in turn drive broader price increases.

“The impact is really on transportation… and the transportation of goods… that will cause a hard push for our prices,” she said.

Garin also cited alternative strategies such as increasing the use of biofuels and promoting electric and hybrid vehicles to reduce dependence on imported fuel.

“If we can increase it to even 10%, 15%, it has to be studied properly,” she said.

Should the Philippines revisit its oil deregulation policy to allow stronger government intervention during price shocks?

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Photo Credit: ABS-CBN Youtube