The Philippines could experience an oil supply shortage in 2022

It has been a terrible start to the year for fuel prices in the Philippines. Prices have notably gone up for the past seven weeks, and by all indications, the country is heading to the eighth straight week of rising gas costs. Starting 6 AM on February 22, 2022, gasoline will go up by P0.80 per liter, kerosene by P0.45 per liter, and diesel by P0.65 per liter.

If that isn't concerning enough, reports are floating around claiming an impending fuel shortage in the country. Those reports could be coming from a Department of Energy (DOE) statement that predicted a local oil supply disruption in the coming months.

The DOE has been proactive as of late, even forming an oil contingency task force to keep track of internal or external supply disruptions. It is also conducting a feasibility study on a planned oil stockpiling program to help ease a possible fuel crisis.

External factors for a possible local fuel supply shortage include tensions between oil producers Russia and Ukraine, a recent explosion of a Nigerian oil vessel, and various oil spills in Ecuador and Kazakhstan.

Motorists and public utility vehicle (PUV) drivers have been among the hardest hit by the continfuel price hikes. Data from the DOE showed that year-to-date price adjustments total a net increase of P7.95 per liter for gasoline and P10.20 per liter for diesel. With the coronavirus pandemic still a looming presence in the country, things could worsen from here.

If an oil supply shortage does hit our shores in the next few months, expect the price hikes to stick. We could be in for a rocky year in terms of fuel security. Still, despite the setbacks, there may be some bright spots on the horizon. 

We may start to see signs of improvement as the Philippines reopens its economy. A new administration set to take its seat in the second half of the year could also shake things up with new ideas and proposals. For now, motorists and ordinary citizens will have to brace themselves for what will likely be a long and expensive 2022.