The authority to set fuel prices may be restored to the government as surging global oil costs, driven by Middle East tensions, prompt a push for the total repeal of the country’s oil deregulation law.

Senate President Vicente Sotto III has filed Senate Bill No. 1984, proposing the repeal of Republic Act No. 8479, or the Downstream Oil Industry Deregulation Act of 1998, which currently lets oil companies adjust pump prices based on market forces.

The measure comes amid consecutive weeks of double-digit increases in fuel prices, with some petroleum products topping P100 per liter.

“It is high time to give back to the state the authority to manage fuel prices. Now that our petroleum prices are directly impacted by the geopolitical tension in the Middle East, transparency, scrutiny and uniformity in pricing are needed more than ever,” Sotto said in the bill’s explanatory note.

RA 8479 was designed to liberalize the downstream oil industry and foster competition by removing government control over pricing. Under the law, oil firms can adjust gasoline, diesel, and kerosene prices, typically on a weekly basis.

Critics, including Sotto, argue that deregulation has weakened the government’s ability to protect consumers from volatile global oil prices. 

Before the law was enacted, petroleum prices were determined by the Energy Regulatory Board using global benchmarks and exchange rates, with the Oil Price Stabilization Fund helping to cushion fluctuations and prevent abrupt price changes.

Repealing the deregulation law would restore the state’s authority to regulate fuel prices and could reintroduce mechanisms to stabilize costs, particularly during periods of international supply disruptions. 

The proposal comes as renewed conflict in the Middle East continues to push up global oil prices, raising transportation and logistics costs and contributing to higher prices for food and other essential goods.

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