18/03/2026
As if the price of fuel isnât painful enough, motorists are paying for something extra at the pump that they are probably unaware of.
Not the Middle East. Not the oil companies. Not the peso. Those are real, and yes, they hurt. But thereâs something else baked into every liter of diesel youâve been buying, written into law twenty years ago, that most motorists have never heard of: CME.
The Biofuels Act of 2006 requires that every liter of diesel sold in the Philippines contain a percentage of coco methyl ester (CME), a biodiesel made from coconut oil. The blend currently sits at 3%. The government planned to raise it to 4% last October, then 5% the year after. They quietly shelved both hikes because coconut oil prices tripled.
The DOEâs own Undersecretary said it plainly: the surge âtranslates to higher costs of diesel at the pump because of the mandate.â
They knew. They just didnât say anything. Or at least not loud enough.
To be clear: this law exists for a reason. Millions of Filipino families depend on the coconut industry. The mandate gives them a guaranteed domestic market instead of leaving them exposed to export volatility. That matters, and itâs worth protecting.
But hereâs how it actually works. When coconut oil is cheap, the blend can slightly lower your costs. When itâs expensive, the mandate forces oil companies to use it anyway, and you absorb the difference. Every motorist. Every trucker. Every business whose delivery costs just went up. Every family buying groceries that arrived on a truck running diesel past a hundred pesos a liter.
Yes, the Middle East and global crude are the main reasons diesel crossed P100 this week. But the mandate quietly adds its own layer on top, and that layer doesnât move when the market does.
The DOE estimates roughly P0.50 per liter for every 1% of blend. At 3%, thatâs around P1.50 embedded in your diesel on a normal day. Today is not a normal day. With diesel averaging over P100 this week, the House just passed a bill on final reading, 209 votes to 5, that would allow the President to temporarily suspend the mandate when blended fuel exceeds pure diesel by 5%. At P102 per liter, that trigger is P5.10. At P114, which some stations are already hitting, itâs P5.70. On a 50-liter fill, thatâs real money. On a trucking fleet, itâs the margin between viable and not.
The bill still needs the Senate and BBMâs signature. It is not law yet. But a 209-5 vote is the government loudly admitting the rigid version was always fragile.
What it should become is permanent. Bake the price-trigger into the law itself. When the blend costs too much, it adjusts automatically, no presidential declaration required. Allow imported biofuel components when local supply canât keep up without spiking prices. Farmers keep their market. Consumers stop absorbing the volatility. Everyone wins.
The rigid version has no shock absorbers. The fix isnât to scrap it. The fix is to make it smart.
Diesel at P100 is already painful enough. You shouldnât also be quietly funding a supply chain you never agreed to fund, especially when nobody thought to tell you.
Now you do.
