Russian oil arrives as Philippines battles 'energy emergency'

A ship carrying more than 700,000 barrels of Russian crude oil has arrived in the Philippines, a source with knowledge of the matter told AFP on Thursday, days after the country declared a national energy emergency over the Middle East war.

The Sierra Leone-flagged Sara Sky, bearing high-quality crude from Russia’s ESPO pipeline, arrived on Monday. Documents showed the consignee as Petron Corp., operator of the Philippines’ sole oil refinery, according to the source, who requested anonymity as they were not authorized to speak to the press.

The Philippines is heavily dependent on imported fuel, the cost of which has surged to historic highs since the US-Israeli war with Iran forced the partial closure of the Strait of Hormuz.

An AFP journalist on Thursday saw the Sara Sky at anchor in Limay port, just outside Manila, where the Petron refinery is located. It is believed to be the first shipment of Russian oil to the Philippines in five years.

Last week, Ramon Ang, CEO of Petron, told AFP that the company was “in talks” to potentially purchase Russian oil. On Thursday, he declined to confirm the arrival of the shipment.

President Ferdinand Marcos Jr. said Wednesday that the Philippines is casting a wide net in its search for fuel, with the country’s dwindling stocks expected to last only another 45 days.

“We have not only gone to our traditional oil suppliers; we have tried to explore other sources that are not affected by the war ongoing in the Middle East,” he said in a press briefing addressing the state of emergency.

“Nothing is off the table. We are looking at everything—everything that we can do.”

The United States this month eased some restrictions on sales of Russian crude, allowing countries to purchase oil already at sea until April 11.

Kpler analyst Muyu Xu told AFP that around 120 million barrels of Russian oil may have been at sea at the time, adding that much of it may have already been pre-ordered by Chinese or Indian clients.

On Thursday, the Philippines’ Department of Energy activated a ₱20-billion ($332 million) emergency fund, which Energy Secretary Sharon Garin described as a “proactive step” to secure fuel supplies.

Garin said earlier this week that the archipelagic nation also plans to boost the output of its coal-fired power plants to keep electricity costs down as the war disrupts gas shipments.

With the cost of LNG (liquefied natural gas) soaring, Garin said the country would “temporarily” be forced to rely more heavily on coal, the main contributor of climate-warming carbon dioxide emissions from human sources.

She added that top coal supplier Indonesia has placed “no restriction” on the amount the Philippines can purchase should it need to increase imports.