Two of the country’s banking leaders have flagged lingering concerns over the domestic economic impact of the ongoing conflict in the Middle East.

Speaking at a Tata Consultancy Services event at the Grand Hyatt last Friday, Union Bank of the Philippines President and CEO Ana Aboitiz-Delgado described the economic consequences of the situation in the Middle East as the “million-dollar question.”

“I think the biggest impact that we're perceiving, of course, is the potential for oil prices to go haywire, supply chains to be affected,” she said. “And of course, the ramifications of that on the economy and the trickle-down effect on all the industries are what we are concerned about.”

At press time, Brent crude was trading at about $93.04 per barrel, West Texas Intermediate (WTI) at around $90.90 per barrel, and Dubai crude — the Platts benchmark — at roughly $99.14 per barrel. Prices have surged by as much as $30 per barrel since the conflict escalated last weekend.

Locally, the government has said that domestic fuel supply remains sufficient for up to two months. The Department of Energy on Saturday also directed industry players to strictly comply with existing fuel pricing rules, stressing that gasoline stations are not allowed to implement unscheduled price increases outside established adjustment schedules.

Members of both the Senate and the House of Representatives have also called for the temporary reduction of value-added and excise taxes on oil to help preserve Filipinos’ purchasing power.

Finance Secretary Frederick Go said last week the country’s economic team would work with Congress to secure authority for the President to temporarily reduce excise taxes on fuel should the price of Dubai crude exceed $80 per barrel — a threshold that had already been breached as of Sunday afternoon.

Meanwhile, Bank of the Philippine Islands (BPI) President and CEO TG Limcaoco noted potential implications for remittances from overseas Filipino workers (OFWs) based in the Middle East.

“Well, for us, first, there's the concern for the people we have over there,” he said.

“Really, the Philippines is quite dependent on a good number of remittances that come from that area. The Filipinos there tend to be higher paid than the average overseas Filipino worker, so that contributes a significant amount of remittances here,” Limcaoco added.

The Bangko Sentral ng Pilipinas (BSP) recently reported that remittances reached an all-time high of $35.63 billion in 2025. The central bank said the figure represented 7.3 percent of the country’s gross domestic product (GDP) and 6.4 percent of gross national income (GNI).

The Middle East is home to around 40 percent of all OFWs, according to BPI Lead Economist Emilio S. Neri Jr. However, he noted that cash remittances from OFWs in the region accounted for less than 20 percent of the record $35.6 billion posted last year, suggesting the impact “may be more contained than expected unless the conflict significantly escalates” — a concern Limcaoco likewise raised on Friday.

“Obviously, if it prolongs itself, there are inflationary pressures, which then feed into what the BSP has to do and how that affects the top corporations as well as the SME [small and medium enterprise] sector,” he said.

As an oil-importing country, the Philippines’ currency as well as headline inflation are particularly susceptible to global oil price hikes. Neri cautioned that inflation could spike to 4 percent as early as next month if the Middle East situation persists.

“Should these trends continue, headline inflation could approach 4.0 percent as early as April. Key swing factors include weather-related supply shocks, rice price momentum, peso volatility and, critically, oil,” he said.