Amid the looming big-time oil price hikes next week, the Bagong Alyansang Makabayan (Bayan) reiterated its call to junk the Oil Deregulation Law (ODL) and scrap the 12% value-added tax (VAT) to protect consumers as tensions in Iran re-escalate. It denounced President Marcos for its failure to implement meaningful steps four months since the Iran crisis and oil shock erupted, while insisting on neoliberal policies like the ODL and VAT that allow oil companies and the government to rake in billions of pesos amid the crisis at the people’s expense.
The Department of Energy (DOE) estimates that pump prices could rise by over P10 per liter due to renewed supply concerns, with vessel traffic in the Strait of Hormuz declining significantly again.
Bayan stressed that oil companies are taking advantage of the deregulated oil industry and the uncertainties caused by the US aggression in Iran to implement unreasonable and exorbitant oil price hikes. Based on its monitoring, the domestic price of gasoline has increased by almost P34 per liter since the US and Israel attacked Iran, even though adjustments in regional benchmark prices could justify at most a P6-per-liter increase during the period. The same pattern holds for the pump price of diesel, which ballooned by almost P36 per liter, compared to an estimated increase of just under P4 per liter, based on movements in the regional benchmark.
The group argued that the Marcos regime is allowing these excessive oil price increases because they mean higher VAT revenues for the government. For 2026, the Bureau of Internal Revenue (BIR) targets total VAT collections of more than P786 billion, almost P107 billion higher than its 2025 actual revenues.
Bayan estimates that the government could be collecting more than P87 million in additional VAT revenue daily from gasoline price increases since the outbreak of the Iran war, and another P129 million daily from diesel price increases.
All these represent an unnecessary and unjust burden for the Filipino people. The group pointed out that the number of poor Filipinos who consider themselves poor jumped by more than 3 million in the past year, according to Social Weather Stations (SWS) surveys. The number of Filipinos who went hungry grew by more than 2 million during the same period.
Meanwhile, oil giants are reaping billions in profits from the surge in fuel prices. Petron reported P1.8 billion in profits for the first quarter of 2026, while Pilipinas Shell reported a net income of P1.6 billion – almost 118% higher than its profits during the same period last year.
Bayan pointed out that the high oil prices concretely illustrate how imperialism oppresses the Filipino people. It noted that the US’s imperialist war against Iran is driving the oil price shock and is aggravated by neoliberal policies imposed on the Philippines by imperialist institutions led by the International Monetary Fund (IMF) and the World Bank.
The passage of the Oil Deregulation Law, for instance, was an explicit structural conditionality tied to the $1.37-billion loan program under the IMF’s Extended Fund Facility during the Ramos administration in the late 1990s.
The IMF and the World Bank also introduced VAT during the first Aquino administration in the late 1980s; it was expanded in the mid-1990s by Ramos under another IMF conditionality tied to a $650-million loan. VAT was raised from 10% to 12% under the Arroyo administration as part of IMF- and World Bank-supported fiscal reforms to supposedly address the country’s growing fiscal deficit and mounting public debt.
As Marcos’s State of the Nation Address (SONA) draws near, Bayan called on the Filipino people to intensify the demand to junk the oil deregulation policy and end regressive tax regimes, such as VAT, to bring down and control oil prices. It also stressed the importance of joining the global pressure for the US and Israel to stop their war of aggression against Iran that is not only driving massive speculation and global oil price spikes but is killing innocent civilians and blatantly violating the sovereignty of the Iranian people