Israel-Iran tensions wake-up call for Asia's dependence on Middle East oil
Hanoi (Vietnam) (AP): Asia's dependence on Middle East oil and gas — and its relatively slow shift to clean energy — make it vulnerable to disruptions in shipments through the Strait of Hormuz, a strategic weakness highlighted by the war between Israel and Iran.
Iran sits on the strait, which handles about 20 per cent of shipments of the world's oil and liquefied natural gas, or LNG. Four countries — China, India, Japan and South Korea — account for 75 per cent of those imports.
Japan and South Korea face the highest risk, according to analysis by the research group Zero Carbon Analytics, followed by India and China. All have been slow to scale up use of renewable energy.
In 2023, renewables made up just 9 per cent of South Korea's power mix — well below the 33 per cent average among other members of the Organisation for Economic Cooperation and Development, or OECD. In the same year, Japan relied more heavily on fossil fuels than any other country in the Group of Seven, or G7.
A truce in the 12-day Israel-Iran war appeared to be holding, reducing the potential for trouble for now. But experts say the only way to counter lingering uncertainty is to scale back reliance on imported fossil fuels and accelerate Asia's shift to clean, domestic energy sources.
“These are very real risks that countries should be alive to — and should be thinking about in terms of their energy and economic security,” said Murray Worthy, a research analyst at Zero Carbon Analytics.
Japan and South Korea are vulnerable
China and India are the biggest buyers of oil and LNG passing through the potential chokepoint at the Strait of Hormuz, but Japan and South Korea are more vulnerable.
Japan depends on imported fossil fuels for 87 per cent of its total energy use and South Korea imports 81 per cent. China relies on only 20 per cent and India 35 per cent, according to Ember, an independent global energy think tank that promotes clean energy.
“When you bring that together — the share of energy coming through the strait and how much oil and gas they rely on — that's where you see Japan really rise to the top in terms of vulnerability,” said Worthy.
Three-quarters of Japan's oil imports and more than 70 per cent of South Korea's oil imports — along with a fifth of its LNG — pass through the strait, said Sam Reynolds of the Institute for Energy Economics and Financial Analysis. Both countries have focused more on diversifying fossil fuel sources than on shifting to clean energy.
Japan still plans to get 30-40 per cent of its energy from fossil fuels by 2040. It's building new LNG plants and replacing old ones. South Korea plans to get 25.1 per cent of its electricity from LNG by 2030, down from 28 per cent today, and reduce it further to 10.6 per cent by 2038.
To meet their 2050 targets for net-zero carbon emissions, both countries must dramatically ramp up use of solar and wind power. That means adding about 9 gigawatts of solar power each year through 2030, according to the thinktank Agora Energiewende. Japan also needs an extra 5 gigawatts of wind annually, and South Korea about 6 gigawatts.
Japan's energy policies are inconsistent. It still subsidizes gasoline and diesel, aims to increase its LNG imports and supports oil and gas projects overseas. Offshore wind is hampered by regulatory barriers. Japan has climate goals, but hasn't set firm deadlines for cutting power industry emissions.
“Has Japan done enough? No, they haven't. And what they do is not really the best,” said Tim Daiss, at the APAC Energy Consultancy, citing Japan's program to increase use of hydrogen fuel made from natural gas.
South Korea's low electricity rates hinder the profitability of solar and wind projects, discouraging investment, a “key factor” limiting renewables, said Kwanghee Yeom of Agora Energiewende. He said fair pricing, stronger policy support and other reforms would help speed up adoption of clean energy.
China and India have done more — but gaps remain
China and India have moved to shield themselves from shocks from changing global energy prices or trade disruptions.
China led global growth in wind and solar in 2024, with generating capacity rising 45 per cent and 18 per cent, respectively. It has also boosted domestic gas output even as its reserves have dwindled.
By making more electricity at home from clean sources and producing more gas domestically, China has managed to reduce imports of LNG, though it still is the world's largest oil importer, with about half of the more than 11 million barrels per day that it brings in coming from the Middle East. Russia and Malaysia are other major suppliers.
India relies heavily on coal and aims to boost coal production by around 42 per cent from now to 2030. But its use of renewables is growing faster, with 30 additional gigawatts of clean power coming online last year, enough to power nearly 18 million Indian homes.
By diversifying its suppliers with more imports from the US, Russia and other countries in the Middle East, it has somewhat reduced its risk, said Vibhuti Garg of the Institute for Energy Economics and Financial Analysis.
“But India still needs a huge push on renewables if it wants to be truly energy secure,” she said.
Risks for the rest of Asia
A blockade of the Strait of Hormuz could affect other Asian countries, and building up their renewable power generating capacity will be a “crucial hedge” against the volatility intrinsic to importing oil and gas, said Reynolds of the Institute for Energy Economics and Financial Analysis
Southeast Asia has become a net oil importer as demand in Malaysia and Indonesia has outstripped supplies, according to the ASEAN Centre for Energy in Jakarta, Indonesia. The 10-nation Association of Southeast Asian Nations still exports more LNG than it imports due to production by Brunei, Indonesia, Malaysia, and Myanmar. But rising demand means the region will become a net LNG importer by 2032, according to consulting firm Wood Mackenzie.
Use of renewable energy is not keeping up with rising demand and production of oil and gas is faltering as older fields run dry.
The International Energy Agency has warned that ASEAN's oil import costs could rise from USD 130 billion in 2024 to over USD 200 billion by 2050 if stronger clean energy policies are not enacted.
"Clean energy is not just an imperative for the climate — it's an imperative for national energy security,” said Reynolds.
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Trump repeats claim he ended conflict between India and Pakistan
New York/Washington (PTI): US President Donald Trump Thursday said he had threatened to put 200 per cent tariffs on India and Pakistan if they didn't stop the fighting last summer, reiterating the claim that he stopped the war between the two nuclear-armed neighbours.
Trump repeated the claim that he stopped eight wars within the first year of his second term in the White House as he addressed an event of the Board of Peace in Washington.
India has consistently denied any third-party intervention.
Pakistan Prime Minister Shehbaz Sharif attended the event along with leaders of the other nations who have signed up to join the Trump-led organisation.
As he addressed the event, Trump listed the conflicts he helped end and asked leaders of the countries to stand up as he mentioned the nations.
Trump asked Sharif to stand up and then said, "I spoke to Prime Minister (Narendra) Modi. He's excited. He's watching us right now."
"Pakistan and India. That was a big one. I think you should actually stand, come please stand just for a second. Pakistan and India. Thank you very much," Trump said.
As he spoke about ending the war between India and Pakistan last summer, Trump said he likes Sharif and the country's Field Marshal and Chief of Defence Forces Asim Munir, whom he called a "great guy".
"…There was some fighting going on when I got to know him (Sharif) and your Field Marshal General. Great, Great General. Great Field Marshal, a great guy,” he said.
Trump repeated the assertion that Sharif had claimed he saved “25 million lives” when he stopped the war between India and Pakistan.
Earlier, Trump had claimed that Sharif said he had saved 10 million lives by ending the conflict between the two nations.
"You made that statement," Trump said to Sharif. “I said 25 million lives, could have been much more actually, but it was really a beautiful thing…. That war was raging. Planes were being shot down, and it was Pakistan and India.
"And I got on the phone with both of them, and I knew him (Sharif) a little bit. I knew Prime Minister Modi very well, actually. I got to know Pakistan through a little trade. They were trying to make too good a deal, and I would get a little upset with them. And in the end, they got what they wanted, right? And they made a good deal, and I got to like them, the Prime Minister, the Field Marshal, who's a tough man, a tough good fighter, serious fighter. I like good fighters, actually,” Trump said.
“And when I heard that they were fighting, I pick up a certain newspaper.… and I saw that Pakistan and India were really going at it. And then it got worse and worse, and… many planes were shot down. It was all out. And I called them, I said, ‘Listen, I'm not doing trade deals with you two guys, if you don't settle this up’. They said, ‘No, no, no’,” Trump said, adding that neither of the two countries wanted to do that.
“I said, ‘No, it has to. If you don't do it, I'm not doing a trade deal. We're not doing a trade deal’," he added.
“And they do a lot of business with the United States, and they sort of softened up all of a sudden. And all of a sudden, I read where there was a little bit of a pullback by one, then the other, and all of a sudden, we worked out a deal. But I said, ‘If you fight, I'm going to put 200% tariffs on each of your countries’,” which essentially would have meant that they could not have done any business with the US.
“One of them, I won't say which one, said, ‘No, can't do that’. They both wanted to fight. But when it came to money, nothing like money. When it came to losing a lot of money, they said, ‘I guess we don't want to fight’. And we solved that deal in two-three days.
“And we did. We said these are two very powerful, two nuclear nations. And I don't want to say what was going to happen, but, you know, bad things happen. So, Prime Minister, I want to thank you, because that was a very big deal. People have no idea. A lot of them say, ‘Oh, well, they weren't fighting’. They were fighting, 11 jets were shot down, very expensive jets, and they were all in. Both of them were all in, and now they're not.
“And I think we'll always be able to settle up with them. I really do. I think… a lot of progress was made, even in the relationship. And Prime Minister Modi also is a great man. He's a great guy. They're all great, but I was very proud of it.”
He, however, did not specify which country's jets he was referring to.
Trump has claimed credit for stopping the India-Pakistan conflict more than 80 times since May 10 last year, when he announced on social media that the two neighbours had agreed to a “full and immediate” ceasefire after talks mediated by the US.
India launched Operation Sindoor on May 7 last year, targeting terror infrastructure in Pakistan and Pakistan-occupied Kashmir in retaliation for the April 22 Pahalgam attack that killed 26 civilians.
India has been consistently maintaining that the understanding on cessation of hostilities with Pakistan was reached following direct talks between the Directors General of Military Operations (DGMOs) of the two militaries.
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