How does the Oil Price Hike affect the Filipino Consumer?

In recent weeks, there has been a continuous and almost weekly increase in petroleum product prices. Since the beginning of 2025, prices of petroleum products such as gasoline, diesel, and kerosene have consistently risen. Table 1 illustrates these price fluctuations, particularly the upward trend in oil prices nearly every week this year. It is also important to note that prior to these consecutive oil price hikes, there had already been nine recorded price increases since October 2024 (Lelis 2024). These oil price hikes at the start of 2025 is a continuation of the trend that began in late 2024.

Table 1. Price range fluctuations of petroleum products in Metro Manila since start of the year 2025
DateJan 7-13, 2025Jan 14 – 20, 2025Jan 21 – 27, 2025Jan 28 – Feb 3, 2025
Price range of petroleum products per literGasolineP51.65 to P75.54 P52.00 to P75.80P52.95 to P78.07P52.55 to P77.27
DieselP49.00 to P72. 20 P49.00 to P73.60P51.70 to P76.05P52.00 to P75.85
KeroseneP70.91 to P82.20 P71.04 to P83.00 P71.74 to P85.50P73.74 to P85.00

Note: Collated by author from the Department of Energy – Oil Industry Management Bureau’s Price Monitoring of Liquid Fuels NCR (https://doe.gov.ph/retail-pump-prices-metro-manila)

Table 2. Oil price hikes since start of the year 2025
DateJan 7-13, 2025Jan 14 – 20, 2025Jan 21 – 27, 2025Jan 28 – Feb 3, 2025Net increase in oil price per liter
Increase/decrease in oil price per literGasoline+P1.00+P0.80+P1.65-P0.80+P2.65
Diesel+P1.40+P.0.90+P2.70-P0.20+P4.80
Kerosene+P1.00+P0.80+P2.50-P0.50+P3.80

Note: Collated by author from Cabuenas (2025a, 2025b), Flores (2025), and Lelis (2025)

Table 2 presents the net increase in petroleum product prices resulting from successive oil price hikes. Diesel prices have risen by P4.80 per liter, kerosene by P3.80, and gasoline by P2.65. These figures in Table 2 account only for price increases that began in 2025 and do not include the hikes from late 2024.

Oil price hikes impact Filipinos especially the low-income groups and minimum-wage earners, but one of the most affected groups are the informal transport workers, particularly those in the jeepney sector. Their livelihoods are heavily dependent on fuel prices, as these directly influence their operational expenses and daily earnings. 

For jeepney operators and drivers, rising fuel costs increase their overall operational expenses, significantly reducing their take-home income – especially when passenger demand is low.

Table 3. Simplified computation of daily income and expense of a Jeepney driver
IncomeExpense/sOverall Balance/Daily Net Income
Typical gross income per day (may vary depending on number of passengers serviced)P2,500.00 to P3,000.00
Fixed boundary per dayP700.00 to P1,000.00
Diesel expense at 30 liters/day for 12-hour jeepney operations for P52.00 to P75.85 price/liter – price between January 28 – February 3, 2025P1,560.00 – P2,275.50
TotalP2,500.00 to P3,000.00P2,260.00 to P3,275.50-P775.50 to +P740.00

Note: Computed by author

Table 4. Simplified computation of daily income and expense of a Jeepney operator-driver(majority of operators are driving their own jeepneys)
IncomeExpense/sOverall Balance/Daily Net Income
Typical gross income per day (may vary depending on number of passengers serviced)P2,500.00 to P3,000.00
Diesel expense at 30 liters/day for 12-hour jeepney operations for P52.00 to P75.85 price/liter – price between January 28 – February 3, 2025P1,560.00 – P2,275.50
TotalP2,500.00 to P3,000.00P1,560.00 to P2,275.50+P224.50 to +P1440.00

Note: Computed by author

Tables 3 and 4 provide a simplified computation of the net income of both jeepney drivers and operator-drivers. Table 3 details the income and expenses of a jeepney driver, showing that net income can sometimes be negative, with the highest possible earnings reaching only P740. Meanwhile, Table 4, which outlines the income and expenses for an operator-driver, shows that net income ranges from P224.50 to P1,440. In both cases, net income is highly volatile, largely influenced by fluctuations in oil prices which take a huge chunk of their operational expense. The listed expenses in Tables 3 and 4 do not yet include for potential additional costs incurred from extortion by corrupt traffic enforcers which impose arbitrary penalties.

On the other hand, the gross income of jeepney operators and drivers is capped as it depends on the fixed number of passengers per trip along designated routes. Additionally, drivers must pay a fixed boundary fee to the jeepney operator or owner, limiting their ability to absorb rising fuel costs.

Table 5. Increase in diesel expense starting 2025
Net increase of diesel price per liter starting 2025+P4.80
Amount of oil used per day30L
Additional total (daily) expenseP144.00 per day
Additional total (monthly – multiplied by 30 days) expenseP4,320.00 per month

Note: Computed by author

The impact of net increase in oil prices, particularly diesel, which is the one used in jeepney operations are shown in Table 5. Despite the year having just begun, diesel prices have already risen by P4.80 per liter. This translates to an additional P144 in daily fuel expenses for jeepney drivers, amounting to roughly P4,320 in extra monthly costs for fuel. This increase places a significant financial burden on jeepney drivers and operators. 

The additional P4,320 could go a long way for families of jeepney operators and drivers. As one jeepney driver stated in an interview with Philstar’s Lelis (2024), many drivers are forced to take on debt just to pay their bills, making it even harder to save.

Aside from the jeepney sector, street vendors and fisherfolk are also heavily affected by rising fuel prices, as they rely on petroleum products for their livelihoods. The increased fuel costs drive up operational expenses, further reducing their already limited income.

Beyond the jeepney sector, oil price hikes create a domino effect on the broader economy. Rising fuel costs trigger increases in food prices and other daily necessities which in turn adversely affect the consumers (IBON 2019; Padilla 2023), especially those from low-income groups, the minimum-wage earners, and other informal workers. Commuters, particularly, may also bear additional transport fares – if informal transport workers petition for fair hikes. These increases in costs of daily goods further straining household budgets already affected by inflation and stagnant wages. 

Rising oil prices, particularly since the enactment of the Republic Act No. 8479 in 1998 (also referred to as the Oil Deregulation Law), have been a persistent burden for jeepney operators and drivers, other informal workers (such as small eatery owner, ambulant vendor selling street food), fisherfolks, low-income group and minimum-wage earners. The Oil Deregulation Law (ODL) removed government control over the downstream oil industry, allowing for automatic oil price hikes. It also allowed oil companies to dictate prices and to operate with minimal accountability, leading to excessive and abusive pricing. With the removal of government ability to control and stabilize pricing, the marginalized groups (specified above) were left at the mercy of volatile global market – controlled by a network of oil cartels (such as the Organization of the Petroleum Exporting Countries), and oil companies – with no mechanisms in place for protection against sudden price surges of petroleum products (IBON Foundation 2002; PISTON 2022). This allows oil cartels and oil companies to dictate what a jeepney driver, small eatery owner or street food vendor, fisherfolk must pay to purchase petroleum products for their livelihood.

Moreover, in 2005, the enactment of Republic Act No. 9337 removed the value-added tax (VAT) exemption for oil products, allowing VAT to be imposed on oil. This tax imposition increased the cost of oil products for consumers, as private oil companies passed the additional tax burden onto them, leading to further price hikes (Yu 2004; Bulatlat 2008; IBON Foundation 2023). Similarly, through the implementation of Republic Act No. 10963, also known as the TRAIN (Tax Reform for Acceleration and Inclusion) Law, in 2018, additional excise taxes on oil products was imposed, which oil companies again passed on to consumers (IBON Foundation 2018, 2019). These lead to an increase of operational costs and decreased incomes for Filipinos, especially the marginalized (PISTON 2004, 2023).

Even the simple act of unbundling – revealing the details of how prices of petroleum products are determined) – for the public to see the different components of fuel costs is seen as compromising “trade secrets” of oil companies (IBON Foundation 2019).

Oil price hikes have also become a taken-for-granted reality due to the ODL’s and other policies’ which normalized corporate control over the oil market and the lack of state intervention in oil price regulation and control; these price hikes have also been reduced to routine news items. Price fluctuations are framed as unavoidable consequences of global market forces, reinforcing the idea that Filipinos must simply adjust.

Oil has a profound impact on Filipinos and the overall state of Philippine economy. The following measures can be undertaken to respond to the problems arising from oil price hikes and oil deregulation:

1. Repeal the ODL to restore government control over fuel pricing, preventing excessive price manipulation and allowing for transparency in pricing mechanisms; and

2. Remove VAT and Excise Tax on Oil for additional taxes on petroleum products imposed by the TRAIN Law and VAT law to be suspended.

Oil price hikes significantly impact people-centered planning, particularly for the transport sector as well as other marginalized sectors (informal vendors, fisherfolks, and low-income groups). It is evident that rising fuel costs and problems that arise from it  (i.e. increased operational costs for informal transport workers, street vendors, fisherfolks; increased living costs for consumers) worsen economic vulnerability, disrupt livelihoods, and deepen inequality. Economic hardships caused by rising fuel prices may also exacerbate competition for limited resources within these affected sectors, potentially leading to tensions amongst them. These limit their capacity to engage in organizing and to participate in community-led initiatives—these problems as well as resulting constraints must be accounted for and integrated in organizing and planning processes.

Potential community development plans may focus on alternative livelihood programs, fuel subsidies, or cooperative models as immediate interventions to address the economic impact of oil price hikes. These measures can help alleviate some of the financial strain on affected sectors. In this context, community development planning must integrate both short-term responses (i.e. subsidies, cooperative initiatives, etc.) to alleviate immediate pressures, and also long-term solutions (i.e. repeal of the ODL and removal of VAT and excise tax on oil). 

References

Bulatlat. 2008. “On Zero Oil Tariff Cut: Relieve Consumers, Not Oil Firms.” Bulatlat, 24 May 2008. https://www.bulatlat.com/2008/05/24/on-zero-oil-tariff-cut-relieve-consumers-not-oil-firms/

Cabuenas, Jon Viktor. 2025a. “Oil firms open 2025 with major pump price hike.” GMA News Online, 6 January 2025. https://www.gmanetwork.com/news/money/companies/931920/oil-price-hike-effective-january-6/story/

Cabuenas, Jon Viktor. 2025b. “Gasoline prices up by over P1/liter Tuesday; diesel, kerosene by over P2/liter.” GMA News Online, 20 January 2025. https://www.gmanetwork.com/news/money/companies/933429/oil-price-hike-effective-jan-21-2025/story/

Flores, Dominique Nicole. 2025a. “Fuel prices up nearly P1 per liter for 2nd straight week.” Philstar, 13 January 2025.https://www.philstar.com/business/2025/01/13/2413883/fuel-prices-nearly-p1-liter-2nd-straight-week

IBON Foundation. 2018. “TRAIN still inflationary with lifting of fuel excise suspension.” IBON Foundation, 30 November 2018. https://www.ibon.org/train-still-inflationary-with-lifting-of-fuel-excise-suspension/

IBON Foundation. 2019. “TRAIN suspension, govt transparency and regulation needed to ease OPH burden.” IBON Foundation, 28 February 2019. https://www.ibon.org/train-suspension-govt-transparency-and-regulation-needed-to-ease-oph-burden/

IBON Foundation. 2023. “Gov’t can mitigate oil price hikes by scrapping fuel taxes.” IBON Foundation, 8 August 2023. 

Lelis, Brix. 2024. “Soaring gas prices put brakes on jeepney drivers (First of two parts).” Philstar, 24 December 2024. https://www.philstar.com/business/2024/12/24/2409408/soaring-gas-prices-put-brakes-jeepney-drivers-first-two-parts

Lelis, Brix. 2025. “Oil firms roll back pump prices today.” Philstar, 28 January 2025. https://www.philstar.com/headlines/2025/01/28/2417355/oil-firms-roll-back-pump-prices-today

PISTON (Pagkakaisa ng mga Samahan ng Tsuper at Operator Nationwide). 2022. Oil Price Hike Discussion Guide. Quezon City: PISTON.

PISTON (Pagkakaisa ng mga Samahan ng Tsuper at Operator Nationwide). 2024. “Jeepney drivers buckle under soaring oil prices as Marcos Jr pampers billionaires with tax breaks — PISTON.” PISTON, 12 November 2024. https://pistonph.com/jeepney-drivers-buckle-under-soaring-oil-prices-as-marcos-jr-pampers-billionaires-with-tax-breaks-piston/

Philstar. 2006. “Oil deregulation law, ibasura — Madrigal.” Philstar, 25 April 2006. https://www.philstar.com/bansa/2006/04/25/333266/oil-deregulation-law-ibasura-151-madrigal

Padilla, Arnold. 2023. “How to cut oil prices in half.” A Radical’s Nut, 17 September 2023.

Yu, Joseph. 2004. “E-VAT, High Oil Prices to Drive Poor Deeper in Debt.” Bulatlat, 30 May 2004. https://www.bulatlat.com/news/5-30/5-30-evat.htm