MANILA, Philippines - The government is readying a nationwide assistance program, estimated to cost P500 million, to allow the transport sector to purchase diesel at a discount of P3 per liter, the energy chief said Friday.

Energy Secretary Jose Rene Almendras said a draft executive order (EO) outlining the program is awaiting approval.

"The draft EO is asking government agencies to align together to cushion the impact of high fuel prices on the transport sector. We're trying to intervene into a situation.. one where we are very limited in our ability to provide subsidies or check on the pricing of petroleum so what we're trying to do is cushion on certain sectors so it doesn't create inflation," Almendras said.

Under the program, public utility vehicles may buy fuel cards that will allow them to purchase diesel at P3 lower than the current price. The cards will be in different denominations.

Diesel now sells at around P45.25 to P47.25 per liter.

The government is expected to start the program in a "week and a half."

Almendras said they are looking at extending the discount to other sectors to cover other means of transport "and we're talking about food inputs, food transport, fishery assistance."

"We don't look at it as a fund, but more on the mechanism of intervention. This is a pilot project...we might even expand the sectoral coverage."

The energy chief noted the government may tap its "operating savings" to finance the assistance program. He earlier said they are looking at "windfall savings" from the value-added tax on petroleum to help the transport sector.