3 more months of emergency seen following Iran peace deal

THE national energy emergency could run for two or three more months after the US and Iran seal their peace deal, with commodity prices needing time to stabilize, the Department of Energy (DoE) said.

“Prices may not necessarily go down (immediately), but they will stabilize. I think, give or take, maybe another two or three months,” Energy Secretary Sharon S. Garin told DzMM radio on Tuesday.

US President Donald J. Trump announced on Monday that the two countries have agreed on a framework to end their war. A memorandum of understanding is scheduled to be officially signed on Friday in Switzerland.

The three-month conflict drove global oil prices to record highs, after Iranian threats to attack tankers transiting the Strait of Hormuz disrupted oil flows from the Middle East.

As such, Philippines declared a state of national energy emergency on March 24 to expedite the rollout of relief measures like the Unified Package for Livelihoods, Industry, Food, and Transport (UPLIFT) program.

The emergency, according to the declaration, has one year to run unless otherwise extended or lifted by President Ferdinand R. Marcos, Jr.

Ms. Garin has said that the UPLIFT committee will need to reassess whether emergency conditions are still necessary.

“The oil industry may no longer require it, but other sectors might still need support, as they continue to be affected,” she said.

Starting on Tuesday, gasoline prices could either fall by P0.32 per liter or increase by as much as P1.68 per liter.

Meanwhile, diesel prices will decline by P3.71 to P5.71 per liter, while kerosene prices will drop by P0.50 to P2.50 per liter.

As of June 12, the national fuel inventory is equivalent to 46.37 days’ demand, against the previous week’s 47.09 days.

The government remains on track to build a strategic oil reserve to shield against future energy shocks.

“This is a lesson learned from the crisis. We really need to build (a national reserve),” Ms. Garin said.

As the initiative will entail a major investment, she said the DoE and its partner agencies are exploring various business models for the operation of the reserve.

Ms. Garin has ordered her team to start building a reserve before the current administration steps down. — Sheldeen Joy Talavera