Gunning for a risk-adjusted Israel-Iran war scenario

PHILIPPINES - In Brief 28 Jun 2025 by Diwa Guinigundo

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Based on the recent assessment by his economic team, Philippine President Ferdinand Marcos Jr was reported to have “downplayed” the expected fallout from the Israel-Iran ballistic war compounded by the US bombing of three nuclear facilities in Iran. Manageable, he said, and “so far, there is no significant effect on the economy.” The President’s comments may be too premature because right before and after the ceasefire unilaterally declared by US President Donald Trump early this week, there were significant mutual ballistic exchanges. Such a truce was almost meaningless because previous attacks on each other were followed by more intense operation. While oil prices exhibited some downtrend for a few days, it was not to continue. The initial decline in oil prices derived from the optimism that the Trump declaration of ceasefire caused across the global markets. This turned out temporary because of the violations of the declaration by both sides. Add to that the increased oil volume by the OPEC + and with global economic growth showing some moderation, oil demand could only trace a slowdown in the meantime. But one cannot be too careful when it comes to the volatility and unpredictability in the oil industry especially when fraught with political undercurrents. Oil prices in the Philippines could make or unmake both the growth and inflation targets. Moreover, the Philippines has already started to evacuate some of its migrant workers in both Israel where some 30,000 Filipinos are reported to be based and some 1,200 Filipinos in the Islamic Republic of Iran. If this spreads out to the other countries in the Middle East, overseas remittances coming from the Middle East co...