Asia scrambles to confront energy crisis unleashed by Iran war – with no end in sight | US-Israel war on Iran

Donald Trump has sought in recent days to reassure the world that the economic impact of his war on Iran can be contained.

Of course, one of the most important waterways in global trade has actually been closed for almost two weeks but could reopen before long. Meanwhile, US sanctions against “some countries” related to oil will also be lifted. Moreover, the entire conflict may end soon.

Such vague claims, and the emergency release of hundreds of millions of barrels of crude oil from government reserves, It eased the markets, at least for a while. Oil prices fell to a four-year high on Monday It fell below $100 per barrel before rising again.

But the war continues. Many merchant ships were hit in and around the Strait of Hormuz. Iran’s Revolutionary Guards announced that they will not allow “one liter of oil” to be exported from the Middle East if US and Israeli attacks continue.

Across Asia, the world’s largest crude oil importing region, rhetoric about the consequences of this conflict is less important than reality. By 2025, the continent was dependent on the Middle East for 59% of its crude imports, according to Kpler.

The Middle East cannot be trusted right now. The Strait of Hormuz, through which approximately one-fifth of the world’s oil supplies and seaborne gas tankers pass, is still completely closed to trade. Some producers in the region, struggling to deliver their oil to the world, are reducing production.

“The situation is certainly very worrying,” said Yousef Alshammari, president of the London College of Energy Economics. Even if ship operators again feel safe sending tankers through the strait, oil producers “will need time to restore supply to pre-crisis levels,” he added.

“The longer the strait remains closed, the more likely these stocks will be depleted and prices will continue to rise, leading to a major global economic crisis,” Alshammari said. “The only solution to this is to reopen the strait and allow navigation to continue.”

From Pakistan to South Korea, Asian countries have been forced to confront a growing energy supply crisis.

China, which has the world’s largest onshore crude oil stocks, in question It has bought millions of barrels of oil from Iran since the war began. India reportedly It increased imports of crude oil from Russia after the US exempted it from sanctions, but hot food and drinks were banned. reportedly It is disappearing from menus across the country due to fears of fuel shortages for cooking. Japan, which has a stockpile of 350 million barrels, is releasing about 80 million barrels (equivalent to a 45-day supply) as part of the International Energy Agency’s largest release to date.

But the relative comfort in the continent’s dominant economies is not shared by most of its peers.

South Korea

South Korea is “heavily dependent on global trade and energy imports from the Middle East,” South Korea’s president Lee Jae Myung said Monday as he announced the first cap on domestic fuel prices in nearly three decades.

Thailand

Thailand’s oil fuel fund spends tens of millions of dollars every day to keep fuel prices artificially low and provide subsidies to consumers. Commerce minister Suphajee Suthumpun urged the public not to panic: According to Bangkok PostHe told reporters the government was preparing scenarios “to deal with any potential impacts.”

Bangladesh

Bangladesh began rationing fuel sales last week in an effort to stop panic buying and closed all universities in an effort to maintain the country’s supply. The situation became so serious that the country, which imports the majority of its fuel, deployed soldiers to large oil depots and police around fuel stations.

Myanmar

The Myanmar junta introduced rationing and banned half of private vehicles from the roads; It allowed those with even numbered plates to drive on even numbers and those with odd numbered plates on odd dates.

Pakistan

Pakistan is implementing austerity measures, including closing schools and allowing government offices to operate only four days a week. “We have taken difficult decisions to stabilize the economy,” Prime Minister Shehbaz Sharif said on Monday.

Fuel tanker drivers were complaining about fuel shortages earlier this week. “Iran closed the border from them,” the driver, Abdul Shakoor, told AFP. “The warehouse remains empty.”

Philippines

Some public officials in the Philippines moved to four-day week as part of the country’s efforts to reduce fuel consumption. Government agencies, public universities and colleges have also been told to reduce fuel consumption by at least 10%, including setting air conditioning units to no lower than 24 degrees.

Vietnamese

Vietnam has called on businesses to “promote working from home whenever possible” to reduce the need for travel, in a sweeping remote working campaign reminiscent of the early days of the Covid-19 pandemic. It is also preparing to lift customs duties on foreign fuels by the end of April as part of the government’s bid to support energy supply, due to long queues at gas stations and rapidly rising prices.

Trump promised light at the end of the tunnel for those trying to overcome this energy crisis. But Asian governments, companies and consumers remain largely in the dark, with no idea how long the tunnel is.

Economic disruption is often contagious. The health of Asian economies is felt far beyond borders, from whether companies are financially comfortable enough to import from abroad to whether citizens can afford to take holidays.