MANILA – Energy Secretary Sharon Garin on Tuesday assured the public that domestic fuel supply remains adequate and measures are now being undertaken along with oil players to ensure stable supply amid the ongoing conflict in the Middle East.
In a briefing at the Department of Energy (DOE) office in Taguig City, Garin said oil companies are compliant on the minimum of 15 days’ supply reserve, thus “we have enough supply.”
She said the DOE does not direct the oil companies to have one-year supply as this will be “very expensive” and additional supply requires more areas to store the fuel.
Garin said oil companies can easily increase their supply since it also takes a week to get their orders from the Middle East.
“But they have more than that. They don’t only have double the minimum requirement, they have three times the minimum requirement,” she added.
Garin said the upticks in global oil prices, with futures touching the USD80 per barrel Monday and declined to around USD79 Tuesday, were expected, but providing projections on how high these will increase is not needed since trading is done on a daily basis and price volatility is currently high.
She said DOE officials had a meeting with oil firms Monday and another one is set Wednesday to determine contingency plans.
“We are hoping for the best but we are preparing for the worst,” she added.
Garin said around 98 percent of crude oil domestic supply comes from the Middle East, while the balance of 2 percent comes from Malaysia and Brunei Darussalam.
The supply from the Middle East is currently experiencing disruptions due to closure of the Strait of Hormuz.
During the same briefing, DOE Director Rino Abad of the Oil Industry Management Bureau (OIMB), said oil companies are used to the need to increase supply as the conflict between Iran and Israel, among others, is not new anymore.
“In fairness to the oil companies, they agreed (to increase their supply) before. So, we had already that experience… So, we’ll just reinforce again that same kind of arrangement with the oil companies tomorrow,” he said.
Abad said they will also compute the possible domestic price hikes for next week starting Wednesday, adding that the full amount will be determined on Saturday when this week’s trading is done.
“And each company will have to decide if the standard increase will be done in two or three implementation(s). But what we want is at least the reasonable adjustment will be done on a weekly basis,” he added.
In an interview after the briefing, Abad told the Philippine News Agency they are already considering tapping, through the private oil companies, other areas for oil imports, such as Africa, Canada and other South American countries. (PNA)