Global Energy Shock
First, the war has disrupted global energy markets, pushing oil prices near $95 despite reserve releases aimed at stabilizing prices.
Moreover, attacks on key oil and gas facilities across the Gulf have sharply reduced production and intensified uncertainty in supply chains.
Collapse of Gulf Energy Supply
Consequently, strikes on major refineries and Iran’s blockade of the Strait of Hormuz have cut Gulf oil output by around 10 million barrels daily.
At the same time, this chokepoint disruption has severely limited exports, worsening shortages across global markets, especially in energy-dependent regions.
Asia’s Extreme Vulnerability
Meanwhile, Asia faces the greatest impact because most countries depend heavily on Middle Eastern oil and gas imports.
In particular, the region relies more than any other on shipments passing through the Strait of Hormuz, increasing its exposure to supply shocks.
Energy Panic Across Governments
As a result, governments across Asia are scrambling to respond, yet they have few immediate solutions to replace disrupted energy supplies.
Furthermore, the sudden shortage has created widespread panic, highlighting structural dependence on external energy sources.
Limited Short-Term Alternatives
However, alternative supply routes and reserves offer only temporary relief, failing to fully offset the scale of disruption caused by the conflict.
Therefore, policymakers face urgent pressure to manage shortages while avoiding deeper economic instability.
Broader Economic Consequences
Finally, the energy crisis is spreading beyond fuel markets, threatening broader economic stability due to rising costs and supply insecurity.
Overall, the war has exposed deep vulnerabilities in Asia’s energy dependence and intensified global economic risks.
Source:
Council on Foreign Relations. (2026). The Iran war is causing energy chaos in Asia. https://www.cfr.org/articles/the-iran-war-is-causing-energy-chaos-in-asia