Asia Needs $1 Trillion a Year to Avoid the Next Energy Shock

Haley Zaremba is an energy journalist and researcher with more than a decade of professional experience covering global energy systems, land and natural resources, and…

Oil and gas may be flowing through the Strait of Hormuz again, but the impacts of its months-long closure will be felt for years to come. For Asia, in particular, regulating markets and shoring up energy security to avoid the next energy shock will require trillions of dollars in the coming years as energy demand projection rates continue to rise sharply across the region.

When traffic through the Iranian-controlled Strait of Hormuz stopped overnight back in February in response to a military offensive by the United States and Israel, one-fifth of the world’s oil and gas trade flowed through the vital artery. While the Strait’s closure impacted energy markets worldwide, no region was harder hit than Asia. Of the roughly 20 million barrels of oil and oil products that passed through the waterway each day before the war broke out, about 80 percent of that oil and 90 percent of natural gas were destined for Asian markets.

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