Fuel price hikes may curb Western Visayas demand

By Mariela Angella Oladive

Rising global fuel prices linked to ongoing tensions in the Middle East may trigger “demand destruction” in Western Visayas as consumers reduce travel and spending to cope with higher transport and energy costs, a regional economic official said.

Department of Economy, Planning and Development (DEPDev) Region VI Director Arecio Casing Jr. said the impact of higher fuel prices was already observed in the first quarter of 2026 during the presentation of the region’s 2025 economic performance on April 23 in Iloilo City.

He noted that inflation indicators have not yet shown significant increases, but warned that a slowdown in consumer spending may emerge as a more immediate concern.

“I think there will be demand destruction, as we tend to travel less and we tend to hold off on our consumption. So these will be the initial effects,” he said.

He added that sustained increases in fuel prices could accelerate the shift toward alternative energy sources and more efficient technologies across sectors.

Casing said solar power adoption has been expanding in government offices and some private businesses, while interest in electric vehicles continues to grow.

“These are the shifts towards the consumption of our citizens and local production, so these are perhaps the things to look at for the year 2026,” he said.

He said mitigating measures are already in place to cushion the potential economic impact of rising fuel prices this year.

These include targeted subsidy programs for farmers, fisherfolk, and transport operators, who are among the sectors most vulnerable to fuel price increases.

Western Visayas recorded a 6.4% economic growth rate in 2025—the fastest among the country’s 18 regions—bringing its economy to PHP 683.44 billion, driven by industry, services, and agriculture, forestry, and fishing.

Global oil prices have remained volatile due to geopolitical tensions in the Middle East, contributing to higher domestic pump prices and transport costs in the Philippines.

Higher fuel prices typically increase the cost of transporting goods and people, which can eventually dampen consumer spending and affect business operations, economists said.