Philippines Declares National Energy Emergency Amid Iran Conflict

On March 24, 2026, Philippine President Ferdinand Marcos Jr. signed an executive order declaring a national energy emergency due to escalating tensions in the Middle East, particularly the conflict involving the United States, Israel, and Iran. This declaration is aimed at addressing potential disruptions to the global oil supply, which could lead to increased fuel and electricity costs in the Philippines. Marcos emphasized that the ongoing conflict is creating uncertainty in global energy markets, disrupting supply chains, and exerting upward pressure on oil prices, posing a significant threat to the country's energy security.

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The Philippines, heavily reliant on fuel imports, is particularly vulnerable to disruptions in key shipping routes like the Strait of Hormuz. The emergency measures include fuel subsidies for public transport, tighter monitoring to prevent hoarding, and expedited approvals for energy projects. Energy Secretary Sharon Garin noted that the country currently has about 45 days of fuel supply but is setting aside approximately 20 billion pesos (S$427 million) to create a diesel buffer, targeting an additional two million barrels of fuel.

The Straits Times

The declaration has already led to significant impacts on the transportation sector, with thousands of jeepney drivers participating in strikes due to rising diesel prices affecting their earnings. Cebu Pacific, a local budget airline, has suspended several international flights until October, citing rising fuel costs and uncertain conditions. Marcos warned that more drastic measures, including potentially grounding flights, could be necessary if the situation deteriorates.

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Economic analysts have expressed mixed views on the government's response. Jonathan Ravelas, a former chief market strategist at BDO Unibank, described the executive order as a precautionary measure, indicating that the government is proactively managing risks from a prolonged oil shock. Conversely, Assistant Professor J.C. Punongbayan from the University of the Philippines criticized the order as reactive and late, suggesting it lacks decisive policy action and relies on existing administrative measures.

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The emergency measures are set to remain in effect for up to one year unless lifted earlier. The situation raises concerns about the Marcos administration's ability to mitigate the economic impact of the oil price crisis, with inflationary pressures likely to persist if oil prices remain high. The declaration has also prompted discussions about potential energy collaborations, including restarting talks with China on joint oil and gas projects in the disputed South China Sea.

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Marcos indicated that the ongoing conflict might provide an impetus for a breakthrough in these discussions, which had previously stalled due to territorial disputes. The Philippines is also exploring sourcing crude oil from Russia as part of its strategy to diversify fuel sources.

Bloomberg

President Marcos stated, “Our foreign policy is very simple: it’s peace and national interest,” emphasizing the need for stability amid the ongoing conflict. He noted that the military alliance with the United States remains strong, with no significant reduction in American military activities in the Philippines despite the Iran conflict.

Bloomberg

While the government has outlined its emergency measures, there are concerns about the effectiveness and timeliness of these actions. Critics argue that the response may not adequately address the immediate challenges posed by rising oil prices and inflation.

The Straits Times

• “This deepens doubts about the Marcos government’s ability to abate the economic impact of the oil price crisis in the coming weeks and months.” — Anonymous Economic Analyst

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• “Bottom line: This is about preparedness – and the practical message for Filipinos and businesses is to brace for higher costs, manage cash carefully, and not assume oil risks fade quickly,” — Jonathan Ravelas, Economic Analyst

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• “As a result, it feels more like a mere summary of the ongoing responses rather than a timely, strategic and forward-looking intervention,” — J.C. Punongbayan, Assistant Professor, University of the Philippines

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