DOE says fuel prices driven by global timing, inventory costs

The Department of Energy (DOE) said fuel price movements in the country are driven by global market timing and inventory costs, not immediate profit shifts for oil companies, amid continued public scrutiny of pump price fluctuations.

In an interview with DZRH, DOE Secretary Sharon Garin explained that oil firms price fuel based on when shipments were purchased, resulting in a lag between global crude price changes and local retail prices.

“May reklamo ang tao… dati mura ang bili, ibebenta nila nang mahal,” Garin said. “Ngayon nagba-balance na siya… may theoretical profit, may theoretical loss din.”

She said this reflects standard global commodity practice, where gains during price spikes are offset when market conditions reverse.

Under the country’s deregulated downstream oil industry framework, companies adjust prices based on import costs and market trends, while the government monitors movements rather than sets retail rates.

Garin also said the power sector remains stable despite reliance on diesel in some off-grid areas, noting that it accounts for only a small share of total generation.

“Ang diesel power plant… fortunately, it is only 3 percent of our power,” she said, adding that coordination with the National Power Corporation (NPC) is ongoing.

She stressed that grid stability is supported by expanded coal and renewable energy capacity, and clarified that outages are unrelated to fuel price changes.

“No blackout because of price increase… ibang causes na ’yan,” Garin said.

The DOE said it will continue its data-driven pricing approach as global oil markets remain volatile.