The crisis within the Strait of Hormuz has shaken the worldwide energy market for the reason that starting of March 2026. Within days, global oil prices rose to almost $120 a barrel, and liquefied natural gas (LNG) prices in Asia saw their biggest increase since 2023.
In early March, the conflict also resulted within the damage, closure or disruption of 13 oil and gas facilities within the Middle East. The most severe direct impacts were felt in Southeast Asia, as most countries within the region are highly depending on imported energy. Meanwhile, other parts of Asia, including East and South Asia, also experienced significant price pressure.
Immediate impact on Southeast Asia
The Strait of Hormuz is a vital route for roughly 20 percent of world oil and LNG trade. Security disruptions in the realm have actually led to a de facto closure as many tankers are reluctant to go through the strait.
This situation has directly undermined the energy security of Southeast Asia, which is heavily depending on imports from the Persian Gulf. The Philippines imports about 96% of its oil needs from the region, followed by Vietnam at 87% and Thailand at 74%.
This dependence has forced governments to take drastic measures. Thailand, which imports almost 80 percent. of its oil and over 1 / 4 of LNG from the Middle East, it used the Oil Fuel Fund mechanism to stabilize prices. The Philippines has even introduced a four-day work week policy to cut back energy consumption and ease economic pressures.
Indonesia also faces significant fiscal pressure. Oil consumption is roughly 1.2 million barrels per day, far exceeding domestic production of roughly 608,000 barrels. As a result, energy subsidies in 2025 have increased to over 300 trillion rupiah.
Malaysia can be in a difficult situation. As an oil exporter, the country advantages from higher revenues but still faces risks if global LNG supplies are disrupted.
The crisis can be affecting mainland Southeast Asia. Long lines at gas stations and restrictions on using vehicles have begun to seem in Myanmar. Laos and Cambodia face similar pressures resulting from their dependence on fuel supplies from neighboring countries.
Renewable energy opportunities in Southeast Asia
The crisis has also highlighted the big potential of renewable energy in Southeast Asia. The estimated total potential of the region is roughly 17,217 GW, dominated by solar energy with a capability of 15,592 GW – enough to satisfy energy demand 40 to 50 times greater than current consumption.
Indonesia is a significant clean energy center with a technical potential of three,687 GW. Most of this energy comes from solar (3,294 GW), followed by wind (155 GW) and hydro (95 GW). However, only about 0.3 percent has been used to date. this potential, well below the national energy mix goal for 2024-2025 of 17-18%.
Vietnam is a pacesetter in offshore wind potential with an estimated capability of 470 GW along its 3,260 km of coastline, although its installed capability is currently only around 20 GW. The Philippines excels in geothermal energy and floating solar energy, with a goal of achieving an extra 52.9 GW of capability by 2034.
Thailand has focused on maximizing biomass and battery energy storage systems, and in 2025, solar capability will increase by 92.5% to achieve 6.5 GW. Meanwhile, Malaysia has prioritized rooftop solar panels and goals to realize 31 percent renewable energy by the tip of 2025 with the support of over 82,000 operating systems.
By combining solar, wind, geothermal and biomass resources, Southeast Asia actually has significant flexibility to cut back its dependence on imported fossil fuels while strengthening long-term energy security.
