Expert: Fuel price shock may spur structural shifts

A surge in global fuel prices is set to drive up transport costs and stoke inflation risks in the Philippines, but economist and licensed environmental planner Prof.

- Ehda M Dagooc Staff Member

Ronilo Balbieran said the shock may prove temporary and could even hasten structural shifts in investment and business operations.Speaking at an economic briefing hosted by the Mandaue Chamber of Commerce and Industry (MCCI) titled “Navigating the Middle East Crisis and Its Impact,” Balbieran said the latest spike in oil prices driven by geopolitical tensions in the Gulf reflects cyclical supply-demand adjustments rather than the onset of a prolonged economic crisis.

“This is a temporary challenge,” he said, explaining that, “when prices rise, suppliers find ways to bring more oil to market, while consumers adjust by reducing demand or shifting to alternatives.”

Higher fuel costs are already squeezing transport and logistics operators, where fuel can account for up to 70 percent of operating expenses. Some long-haul trucking services have slowed or halted operations while seeking approval for fuel surcharges.