The Department of Economy, Planning, and Development (DEPDev) said suspension on excise tax on petroleum products will bring down oil prices by P6 per liter for diesel and P10 per liter for gasoline.

In a briefing with various government agencies before the House ways and means committee, DEPDev Undersecretary Rosemarie Edillon disclosed the figures.

At least five pending bills seeking to allow President Ferdinand Marcos Jr. to suspend or slash fuel excise taxes during emergency situations, such as the ongoing conflict in the Middle East.

One of the measures is House Bill No. 8292 of Speaker Faustino Dy III and Majority Leader Sandro Marcos, which seeks to authorize the President to suspend or reduce the excise taxes on petroleum products during national or global economic emergencies.

Edillion said the DEPDev has simulated the prices for two scenarios:

• The Dubai crude oil average cost will reach $98 or above $80 per barrel until April, and
• The worst-case scenario in which the average cost of Dubai crude oil will reach $140 per barrel due to the prolonged closure of the Strait of Hormuz where 20% of the world’s seaborne oil trade actually happens.

“We simulated the impact of an excise tax suspension. We know that for regular gasoline, its P10 pesos per liter. And then for diesel, P6 pesos per liter. With excise tax suspension under scenario 1, the average cost of diesel at P74.22 pesos per liter will go down to P67.50 per liter. And then for April, from P67.33, it could go down to P60.61,” Edillon said.

Gasoline, on the other hand, will be reduced from P70.20 per liter to P59 pesos per liter this March.

But for the second scenario, Edillion said the average diesel price – which will reach P96.76 per liter – will be down to P90.04 pesos per liter for March.

Average diesel prices are expected to taper down by April at P91.19 pesos per liter, which will be reduced to P84.47 with the suspension of fuel excise taxes, Edillon said.

For gasoline under the second scenario, the average cost of P64.59 in April will go down to P53.39 per liter.

“In terms of incidence of the impact, of course, the effect on diesel users is greater on the lower income class, but there is also a spillover. Whereas, for gasoline, it’s more or less shared across. It’s almost uniform,” Edillon said.