When jeepney driver Toni Prado told reporters in Manila last week that his daily earnings had collapsed from 1,000 pesos to 200, he was not describing bad luck. He was describing the predictable endpoint of a structural vulnerability that the Philippine government had long documented but failed to fix. Prado was among thousands who joined the nationwide transport strikes of 19 March, protesting diesel prices that had more than doubled since the escalation of the US–Israel–Iran conflict.
The proximate cause – escalation of conflict and fresh tanker-risk volatility in the Strait of Hormuz – is real. But for the Philippines, it is almost beside the point. The Department of Energy’s own Key Energy Statistics Pocketbook 2024, released last year, had described with near-mathematical precision what a Hormuz disruption would mean for the country. Policymakers had the document. They had the numbers. What they lacked was greater urgency in acting on them.
The 2024 statistics highlight three interlocking vulnerabilities.
Southeast Asia as a whole continues to rely on the Middle East for more than half of its oil imports, while the region’s energy demand grows faster than its diversification efforts.
First, more than 95% of crude oil imports came from the Persian Gulf, supplied primarily by Saudi Arabia (accounting for more than half), the United Arab Emirates and Iraq. Domestic crude production remained near zero.
Second, the transport sector absorbed almost two-thirds of all petroleum consumed nationally, with jeepneys – the often-colourful public transport vehicles that crowd the streets in the Philippines – and inter-island cargo vessels running almost entirely on imported fuel.
Third, the transport sector is not merely the country’s largest petroleum consumer – it is the circulatory system of Philippine economic life, moving nearly 40 million passengers daily and employing close to two million people, almost all of whom depend entirely on imported diesel to earn a living.
Together, these figures describe a country structurally positioned to feel every significant shift in Gulf supply as a sharp impact at the pump. The Strait of Hormuz carries a substantial portion of globally traded seaborne oil – roughly one-fifth of all oil traded by sea. War-risk insurance premiums for tankers have risen sharply, and spot prices followed. For an economy sourcing most of its crude from one corridor and directing that crude straight into its most essential economic sector, the transmission from global market signals to domestic pump prices occurs quickly.
Compounding the exposure is the strategic reserves position. As Energy Secretary Sharon Garin confirmed, the Philippines holds approximately 45 days of diesel supply in-country. This falls short of the International Energy Agency’s recommended 90 days of net-import cover for major oil importers, leaving a narrower buffer on critical fuels.
The government’s emergency measures carry clear logic. The Department of Energy circular permitting temporary use of Euro-II fuels for older vehicles and power plants offers a pragmatic supply adjustment. Driver subsidies, tax relief, and expanded free-ride program help cushion the immediate social effects. Diversification discussions with India, Japan, South Korea and Brunei, together with initial consideration of Russian crude imports under a temporary US sanctions waiver, reflect a short-term effort to broaden supply options.
Yet these steps function as triage for a condition already visible in official data. The reserves situation was known. The concentration of import sources was documented. And yet, the day before President Ferdinand Marcos Jr. signed the Executive Order declaring a national state of energy emergency, the administration had insisted there was “no oil crisis”.
This episode carries implications beyond Manila. Southeast Asia as a whole continues to rely on the Middle East for more than half of its oil imports, while the region’s energy demand grows faster than its diversification efforts. Vietnam and Thailand possess modest domestic production that provides some additional buffer to the Hormuz disruption. Indonesia retains refining capacity. But the broader pattern – heavy import dependence, limited reserves and transport-sector reliance on petroleum – is shared across many net importers in the region.
What the Philippine case illustrates is that the distance between recognising a vulnerability in official data and treating it with sufficient urgency can persist, even when the mechanism of potential harm is well understood and geopolitical signals point in a consistent direction. That distance reflects a political and institutional challenge rather than an intelligence shortfall.
The path forward is clear. Accelerating the build-out of strategic petroleum reserves would narrow the most immediate gap, though the financial cost is substantial – estimated at more than PHP150 billion (US$2.5 billion). An ASEAN-level emergency petroleum reserve-sharing mechanism, adapted from the IEA collective action model to regional realities, could offer wider insurance that individual net-importing nations would find difficult to sustain alone.
The Philippines also possesses one of the region’s most uniformly distributed solar resources. Yet solar currently accounts for only 3% of electricity generation, while the transport sector remains almost entirely petroleum-dependent. Addressing that imbalance requires sustained policy attention of a different order – beyond emergency powers.
Local drivers like Toni Prado do not need a state of energy emergency declared on their behalf. They need the government to treat the data it already produces as guidance for timely action, rather than as a formality.
