The Philippines intends to establish a government-run oil stockpile to safeguard against supply disruptions similar to those caused by the Middle East war, Energy Secretary Sharon Garin announced on Monday. The conflict, which began in February, sent fuel prices to record highs and prompted President Ferdinand Marcos to declare a national energy emergency.
Details of the Stockpile Plan
Garin stated that the national stockpile would aim to add at least 30 days' worth of petroleum product reserves to the existing 30 to 60-day reserves currently mandated for local oil companies. This initiative is designed to prevent shortages and panic during international crises.
Investment and Funding
The construction of a single 500,000-barrel storage tank, equivalent to the country's daily oil consumption, is estimated to cost around five billion pesos ($81 million). Garin noted that such a reserve would require a "huge investment." Potential funding sources include the state-run Philippine National Oil Co. and the Maharlika Investment Corp., the country's sovereign wealth fund.
International Support
Japan has pledged to support the project by conducting feasibility studies and providing capacity building for developing a stockpiling system. Garin confirmed that President Marcos secured this commitment during a state visit to Tokyo last month.
"This is to ensure that we do not run short of oil or go into panic each time a war breaks out in another country, that we are assured that for a certain number of days, we have a steady supply of oil," Garin said in a news conference.
