In short
How Iran-linked disruptions and the Strait of Hormuz affect Asia’s energy and downstream economy.
Guest backgrounds
Mayank Maheshwari, Morgan Stanley Research Analyst covering energy markets in India and Southeast Asia.
Key claims
About a quarter of Asia’s oil, LNG, and propane comes from the Middle East via Hormuz; disruptions impact power generation, industrial output, and food supply chains. Price stress: oil near $100/bbl; diesel margins double pre-conflict; jet fuel premiums nearly doubled; Dubai crude now >$20/bbl premium to Brent. Dependence: refiners source up to 80% crude from the region; 30–40% of LNG imports originate there; India/China pass 40–50% of oil demand through Hormuz.
Notable examples
LNG buffer is limited; Qatar LNG infrastructure damage; ~25 million tons/year petrochemical capacity and ~10 million tons fertilizer production impacted; polymers up 15–25%; cooking gas shortages; governments release ~100 million barrels from reserves and may shift back to coal.
Written by AI. May contain mistakes. Listen to the episode to check what was said.
Chapters
Tap a time to open that second in VOImpact of Hormuz Disruptions on Asia's Energy
0:45 to 1:54
Exploration of how Hormuz disruptions affect oil, gas, and overall supply chains.
“Asia hasn't seen a true energy access shock in over 50 years.”
Broader Economic and Social Implications
1:54 to 3:17
Analysis of the wider effects of energy disruptions on chemicals, food, and services.
“and export restrictions are limiting downstream production of fuels.”
Transcript
Automatic transcript. May contain errors.0:00Welcome to Thoughts on the Market. I am Mayank Maheshwari, Morgan Stanley's Research Analyst, covering energy markets in India and Southeast Asia. Today, how disruptions linked to Iran and the state of Hormuz are creating energy-related disruptions across Asia. It's Monday, March 23rd at 8am in Singapore. To understand the scale of the impact, let's start with a simple fact. About a quarter of Asia's energy, that is oil, liquefied natural gas and propane, comes from the Middle East. Much of it flowing through a single choke point, the state of Hormuz. Any disruption here affects more than just oil prices.
0:41It also hits power generation, industrial output and even food supply chains across the region. Asia hasn't seen a true energy access shock in over 50 years. So that makes this movement very critical. And with oil around$100 per barrel, stress is building in the system. Diesel margins are double pre-conflict levels. Jet fuel premiums have nearly doubled. And Dubai crude, normally cheaper than Brent historically, is now trading at a premium of more than$20 per barrel. This kind of price move signals tightening supply chains. Asia's dependence on Middle East runs deep. Refiners source up to 80 % of crude from the region, and 30-40 % of LNG imports originate there.
1:30For major economies like India and China, roughly 40-50 % of oil demand passes through Hormuz. It's a critical energy highway, and when flows slow, the entire system backs up. Inventories may look like a buffer. Asia holds around 65-70 days of crude, but the system reacts sooner than waiting to run out. Governments are already rationing energy, industries are cutting LNG and LPG usage, and export restrictions are limiting downstream production of fuels. The tightening has already begun. The real pressure point may not be oil but natural gas, particularly LNG as Qatar, which is a big supplier of Asia's LNG, has seen infrastructure damage.
2:14Asia accounts for about half of global LNG consumption with up to 40 % secured from the Middle East. Unlike oil, LNG has very limited buffer in number of days and not in months. This is where the story extends well beyond energy. Around 25 million tons per year of petrochemical capacity has been impacted, along with roughly 10 million tons of fertilizer production. Prices for key materials like polymers have risen 15-25 % in just few weeks, and the premiums are still rising. These inputs feed into everyday products, from cars and electronics to packaging and agriculture. Even basic services are affected, with cooking gas shortages hitting restaurants in parts of Asia.
3:00Policymakers are responding, but options are limited. Around 100 million barrels of crude has been released from reserves. Countries are securing higher-cost LNG cargos, and many are turning back to coal for reliability despite environmental trade-offs. Ultimately, the longer this disruption persists, the more pressure builds across energy, power, chemical and food systems. And in a region as interconnected and import dependent as Asia, those ripple effects spread quickly and widely. Thanks for listening. If you enjoy Thoughts on the Market, please leave us a review wherever you listen and share the podcast with a friend or a colleague today.
3:42Mayank Maheshwari:the preceding content is informational only and based on information available when created it is not an offer or solicitation nor is it tax or legal advice it does not consider your financial circumstances and objectives and may not be suitable for you
From the publisher
Our Asia Energy Analyst Mayank Maheshwari discusses how the conflict in the Middle East is sending ripple effects through Asia’s energy, power and food systems.
Read more insights from Morgan Stanley.
----- Transcript -----
Welcome to Thoughts on the Market. I’m Mayank Maheshwari, Morgan Stanley’s research analyst covering energy markets in India and Southeast Asia.
Today—how disruptions linked to Iran and the Strait of Hormuz are creating energy-related disruptions across Asia.
It’s Monday, March 23rd, at 8am in Singapore.
To understand the scale of the impact, let’s start with a simple fact: about a quarter of Asia’s energy—that is oil, liquefied natural gas, and propane—comes from the Middle East, much of it flowing through a single chokepoint, the Strait of Hormuz. Any disruption here affects more than just oil prices. It also hits power generation, industrial output and even food supply chains across the region.
Asia hasn’t seen a true energy access shock in over 50 years. So that makes this moment very critical. And with oil around $100 per barrel, stress is building in the system. Diesel margins are double pre-conflict levels. Jet fuel premiums have nearly doubled. And Dubai crude—normally cheaper than Brent historically—is now trading at a premium of more than $20 per barrel. This kind of price move signals tightening supply chains.
Asia’s dependence on [the] Middle East runs deep. Refiners source up to 80 percent of crude from the region, and 30–40 percent of LNG imports originate there. For major economies like India and China, roughly 40–50 percent of oil demand passes through Hormuz. It’s a critical energy highway. And when flows slow, the entire system backs up.
Inventories may look like a buffer. Asia holds around 65–70 days of crude. But the system reacts sooner than waiting to run out. Governments are already rationing energy, industries are cutting LNG and LPG usage, and export restrictions are limiting downstream production of fuels. The tightening has already begun.
The real pressure point may not be oil, but natural gas—particularly LNG, as Qatar, which is a big supplier of Asia's LNG, has seen infrastructure damage. Asia accounts for about half of global LNG consumption, with up to 40 percent secured from the Middle East. Unlike oil, LNG has very limited buffers; in number of days, and not in months.
This is where the story extends well beyond energy. Around 25 million tons per year of petrochemical capacity has been impacted, along with roughly 10 million tons of fertilizer production. Prices for key materials like polymers have risen 15–25 percent in just a few weeks, and the premiums are still rising. These inputs feed into everyday products—from cars and electronics to packaging and agriculture. Even basic services are affected, with cooking gas shortages hitting restaurants in parts of Asia.
Policymakers are responding, but options are limited. Around 100 million barrels of crude has been released from reserves. Countries are securing higher-cost LNG cargoes. And many are turning back to coal for reliability despite environmental trade-offs.
Ultimately, the longer this disruption persists, the more pressure builds across energy, power, chemicals, and food systems. And in a region as interconnected and import-dependent as Asia, those ripple effects spread quickly—and widely.
Thanks for listening. If you enjoy Thoughts on the Market, please leave us a review wherever you listen and share the podcast with a friend or colleague today.