Global energy shock triggers emergency measures in Asia


Asian governments are resorting to emergency measures in anticipation of crippling fuel shortages triggered by the US-Israel war on Iran and disruption at the Strait of Hormuz .

Iran's control over the strategic waterway has trapped a fifth of the world's oil and gas in the Gulf, threatening a historic crisis in a region heavily reliant on energy from the Middle East.

Governments across the region have moved to curb fuel use by cutting work weeks, introducing work-from-home policies and turning off streetlights.

The Philippines, which imports almost all its oil from the region, has declared a nationwide state of emergency and is turning to coal-fired power plants to keep the lights on for longer.

In Australia, fuel scarcity is increasing in rural areas, with more than 500 petrol stations across the country now out of at least one type of fuel.

Schools have been closed in Pakistan, Bangladesh is rationing fuel, and Japan and South Korea have launched emergency reviews to prepare for worst-case scenarios.

Even in China, which is thought to hold the largest strategic oil reserves in the world, the government has softened a planned fuel price hike following a 20 percent rise in petrol costs.

The war has seen almost all shipping in the Gulf grind to a halt, severing countries' access to vital commodities such as fuels, fertilizers and metals.

The crisis has removed as many as 11 million barrels of oil per day from the global market in what the head of the International Energy Agency (IEA) has described as the "greatest global energy security threat in history".

Regional oil prices have surged to near record levels, and though Western benchmarks have lagged behind, analysts say that rising shortages will soon see them shoot above their July 2008 record highs.

Costs for fertilizers, petrochemicals and other products have also soared, threatening to trigger shortages of food and essential products in vulnerable parts of the world.

In a bid to ease the shock, IEA member states agreed on 11 March to release a third of their combined emergency oil reserves – enough to cover the shortfall for around a month – while the US has waived sanctions on Russian and seaborne Iranian crude.

One month in, there is little sign of an imminent resolution to the conflict, with Iran this week rebuffing pressure from Donald Trump's to accept its pre-war demands in exchange for a ceasefire. US officials are thought to be exploring a range of options to further escalate the conflict, including deploying ground troops to seize Iranian territory.

Published: Modified: Back to Voices