Almendras: oil prices to ease gradually

Any decline in fuel prices will take time to reach consumers, even as global oil markets begin to cool following recent geopolitical developments, former Energy Secretary Rene Almendras said on Wednesday, 8 April.

Almendras noted that while crude prices have softened from recent highs, volatility persists due to uncertainty in the Middle East and uneven movements across global benchmarks and futures markets. This, he said, makes it difficult to expect immediate relief at the pump.

He explained that local fuel prices are based on averaged global costs, meaning recent declines will only gradually reflect in domestic pricing. While there is potential for price rollbacks, the extent will depend on sustained trends in the coming weeks.

Almendras also cautioned against calls for price regulation, stressing that the global oil market operates on a deregulated system that limits government intervention. “You cannot deregulate a market. Even the international market is not regulated. If you regulate it, it will cost us,” he said.

He pointed out that some countries are able to cushion fuel costs through subsidies because they are oil producers. However, even these nations are facing fiscal pressure and may eventually scale back such programs. For import-dependent economies like the Philippines, he said, similar interventions would require significant public funds.

Despite the reopening of key shipping routes such as the Strait of Hormuz, Almendras said supply conditions will not normalize immediately due to logistical bottlenecks. “Even with Hormuz open, even if we declutch the ships that are stuck, you're still talking refinery capacity and storage. It will take 30, 60, maybe even 90 days for the logistical flow to normalize,” he said.

He added that while prices may trend downward, expectations should be tempered as a return to significantly lower levels remains unlikely in the near term. Market stability will depend on how quickly supply chains recover and whether geopolitical tensions ease further.