The surge in global oil prices combined with currency fluctuations, has pushed the average Fuel cost in the Philippines upwards by more than 66% since 2019.

Below is the current average prices on gasoline and diesel:

This surge doesn’t just impact gas tanks. It sends far-reaching ripples through households, affecting daily life and demanding nothing less of a strategic approach to budgeting.

1. Why are fuel prices going up?

There are many factors contributing to the rollercoaster ride of Fuel Prices. Here are the main ones:

• Global crude oil impact. Geopolitical tensions, supply-demand dynamics, and even unexpected events play a role in dictating oil prices. For instance, the recent tensions in the Middle East have caused fluctuations in global oil prices, directly influencing local fuel costs.
• A weakened Philippine peso. The position of Philippine peso against major currencies adds another layer to the issue. As the peso loses value, the cost of importing oil rises, placing additional pressure on fuel prices. A prime example is how the depreciation of the peso has led to higher prices at the pump, directly impacting consumers’ wallets. 

2. What are the consequences of inflation?

Rising fuel costs also contribute to inflation, affecting both low-income families and the broader economy.

• Higher cost for essentials. The domino effect leads to higher costs for essentials like food and medicine, impacting low-income families disproportionately. Families are grappling with increased grocery bills due to rising transportation costs, making it harder to put food on the table.
• Reduced consumer spending.  Lowered spending on non-essential items can potentially slow overall economic growth and impact job opportunities. For instance, reduced consumer spending on discretionary items or wants like dining out or entertainment due to higher fuel costs directly affects local businesses’ revenues.

3. How to combat overspending on fuel

Fuel prices may be on the rise, but it doesn’t mean you have to spend more than your comfortable just to operate your vehicle. Let’s walk you through some measures to take in managing your finances effectively amidst the ridiculous price hikes.

• Fix a budget for fuel. Allocate a specific portion of your monthly income to fuel expenses. Sticking to a dedicated amount not only promotes financial transparency but also prevents budgetary surprises. So if you’re going to set 10% aside for fuel money, do your best to avoid going beyond that.
• Monitor fuel prices. Keeping an eye on fuel price trends and refueling during periods of lower costs can lead to substantial savings over time. Be sure to keep with up the local news for announcements of price hikes. Staying informed helps you time your fuel station visits accordingly.
• Practice fuel-efficient driving habits. Modifying your driving behavior can help conserve fuel and contribute to a greener environment. For instance, observe gradual acceleration, gradual braking, steady speeds, and proper vehicle maintenance.

• Strategic spending. Exploring credit card promotions and loyalty programs that offer fuel-related perks can yield significant savings, effectively making your budget work harder. Look into local credit card offers that provide cashback or discounts specifically on fuel purchases, allowing you to stretch your budget further.
• Take advantage of discounts. Capitalizing on loyalty cards offered by major oil companies and their retail partners can provide valuable discounts and future fuel benefits.

4. Trimming down your regular fuel expense

In this section, we’ll discuss options pertaining to broader lifestyle changes that can massively save you more than just fuel expenses.

• Drive less by using public transport or carpool options. These will not only reduce fuel consumption but also contribute to reduced traffic congestion and lowered carbon emissions. Consider the example of communities implementing carpool lanes to incentivize shared rides, contributing to both cost savings and reduced traffic congestion.
• Negotiate a work-from-home arrangement with your boss. Many local companies have embraced flexible work arrangements, which allows employees to work from home part of the week. So if you’re not already doing this, don’t hesitate to open the discussion with your employer!
• Batch your errands. Being too fragmented and spreading out your errands across different days can be wasteful. So if it’s possible to set a time during the week or month to attend to all of them, go ahead and do that. This approach saves you precious time, fuel, and stress.

Pressing on with confidence

In these times of rising costs and fuel expenses, proactive measures are essential. By combining prudent savings practices with strategic fuel budgeting, you can face these financially turbulent times with resilience.

These strategies not only safeguard financial stability but also empower us to forge the road ahead with poise and control. Just as a skilled driver maneuvers through changing terrains, your financial choices and actions will guide you toward lasting fiscal well-being.

The post A Sound Guide To Rising Fuel Prices In The Philippines appeared first on iMoney.ph.