MANILA – The Department of Energy is looking at the possible importation of biofuels as a contingency measure to address potential oil price spikes stemming from supply risks in the Middle East.
Speaking before the Senate on Wednesday, Energy Secretary Sharon Garin clarified that the agency is not seeking to modify the mandated fuel blend in domestic petroleum products, as this is restricted by law.
Instead, the DOE is proposing to allow the temporary importation of biofuels if the price of pure gasoline rises more than five percent above the blended fuel price. The measure would only be implemented for up to one year, and possibly for a shorter period.
The proposal must still comply with the Biofuels Act of 2006, which states that imported biofuels may only be used once domestic supply has been fully utilized.
Garin said current local fuel supply remains adequate but could only cover demand until the end of April.
To ensure supply stability, the DOE continues to engage industry players and other stakeholders.
However, she noted that uncertainties remain because global oil shipments pass through the Strait of Hormuz, making the region sensitive to geopolitical developments.
Because of tensions in the Middle East, the cost of transporting fuel — including insurance and shipping expenses — has increased, which may influence domestic fuel prices.
Garin said allowing additional biofuel imports could help extend available supply in case disruptions occur. Increasing the biofuel component in gasoline may stretch fuel reserves and ease supply pressures.
While she acknowledged that pump prices are likely to increase, she said higher biofuel use in gasoline could help soften the impact of price surges.
The DOE has also been promoting conservation measures, including reducing electricity consumption and encouraging motorists to carpool, to help manage fuel demand amid global supply uncertainties.
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