Philippines suspends fuel taxes as Middle East war drives up costs

A man lights a fire for cooking inside a house in Capas, Tarlac province, the Philippines, on September 2, 2026, amid rising fuel costs that have prompted the government to suspend excise duties on liquefied petroleum gas and kerosene. — AFP pic

First Published: Saturday, 26 Sep 2026 2:04 PM MYT

MANILA, Sept 26 — The Philippines temporarily suspended excise duties on petroleum products used for cooking, the presidential palace said on Friday, as it struggles to deal with soaring fuel costs from the Middle East war.

The temporary suspension covers liquefied petroleum gas (LPG), the country’s main fuel for cooking, as well as kerosene, according to an executive order released to the media on Friday.

“The excise taxes on LPG, except when used as a raw material for production of petrochemical products or used for motive power, and kerosene, except when used as aviation fuel, are hereby fully suspended,” it said.

The cut translates to a reduction of about three pesos (about five US cents) per kilogramme of LPG.

The excise cut followed a threat by bus operators to hold a two-day nationwide transport strike next week to press the government to let them raise fares, which are state-regulated.

Fuel prices in the Philippines are unregulated, unlike neighbours including Indonesia, Malaysia and Thailand, leaving local transport firms to deal with market fluctuations.

Philippine President Ferdinand Marcos Jr said the tax would automatically revert after three months, or a week after the one-month average Dubai crude oil price falls below US$80 (RM336) per barrel.

He said the average crude oil price over the 30 days to September 11 had reached US$99.41 (RM418.02).

The import-dependent Philippines declared a national energy emergency in March and has been forced to cast an ever-wider net for fuel, including purchases of oil from Russia.

The war in the Middle East and high inflation trimmed the Philippines’ economic growth in the first half to 2.6 per cent, well below government targets. — AFP