Impact to Asia of the Middle East Oil Shortage

Just some snippets taken from an NYT article opened by the subscriber to other readers. What the NYT article is looking at is the impact to Asia of the Middle East oil stoppage. The shortage being the on-and-off closing of the Straits of Hormuz. Caused by either by Iran or the United States of both on and off. Oil reserves in Asia are less than what would be in the United States. NYT is open to readers.

Asia-Pacific: Hit hard and quickly by the war in Iran and its energy bottlenecks. Scenes of crisis there indicate that problems are multiplying and spreading. AB: No different than what I said a few days ago. The impact of the United States attack on Iran would result in impacting Thailand. This will also impact the Philippines, China, Malaysia, Hong Kong, etc. Map Data by Google.

“Iran War Sent Shock Waves Through Asia That Are Likely to Spread,” New York Times, April 2026

The Asia-Pacific has been the war’s first and worst zone of impact outside the Middle East because:

Wealthier countries, including China, face less immediate risk, with bigger fuel reserves and budgets. But comfort is neither permanent nor widespread. The rest of Asia, excluding China, is responsible for as much of the global economy as the United States or Europe. And many countries in that group have been struggling more than is publicly known.

In interviews: farmers in Vietnam, laborers in India, innkeepers in Sri Lanka, drivers in the Philippines, and executives in Hong Kong and Singapore are worried. More worried than many of the region’s politicians of these nations. Politicians who are seeking to project a stoic calm which understates the scramble occurring offscreen for oil and oil product.

Transportation, manufacturing and upward mobility are the three pillars of stability in Asia. All are confronting powerful shock waves.

A Sprawling Transportation Crisis

The United States and Israel started the war in Iran on Feb. 28. Within hours, the trucks, ships and planes stopped operating. Asia is a region defined by constant motion across land, sky and sea.

Air travel, the strongest example of Asia’s transportation reversal, veered toward chaos. In March, there were more than 92,000 flights canceled worldwide, doubling the prewar rate of cancellation, with the largest spike in eliminated flights linked to the Asia-Pacific.

Halted Production Due to the US Intervention

AB: As I said earlier, the cuts in the Middle East will have an impact in places like Thailand. They do not keep vast inventories of fuel. Such would be found in the United States. Even so, such inventory is subject to pricing increases regardless of how old the inventory might be, how much there is, and the cost of it.

Many of Asia’s more successful export industries require enormous amounts of energy and other ingredients from the Middle East. Seven weeks into the stoppage, stockpiles are running out. Cutbacks in manufacturing are now multiplying, revealing energy vulnerabilities rarely considered.

Copper and nickel production rely on high heat from natural gas as also does sulfur, a fossil fuel by-product. Both metals are in short supply, forcing several Indonesian nickel processors to reduce output by at least 10 percent.

Polyester and nylon are also derived from petroleum. In the sewing hubs of Bangladesh, Gazipur and Ashulia, clothes are made for Wal-Mart, Zara and Uniqlo. Severe disruptions hampering production and shipment schedules are common. With US intervention, these disruptions are on track to worsen with energy shortages.

Abdullah Hil Nakib, deputy managing director of TEAM, a Bangladeshi garment factory group.

“We are under a strain now due to the US intervention. Managing it will become very tough if there is no continuity in gas or fuel supply. We are seeing the prices of our raw materials are also rising. Today the price of thread has almost doubled.”

On higher-end manufacturing and with helium, being a gas byproduct used for semiconductors, the stress levels increase. Qatar, which normally produces nearly one third ​of the world’s supply, had to halt production on March 2 after an attack on its gas plants by Iran.

Prices have soared, and some Asian chipmakers are slowing production as they reconsider sources of supply.

The world’s largest producer of high-end chips, Taiwan Semiconductor Manufacturing Company had previously accepted helium from Qatar and the United States. On Thursday, the company said on an earnings call that it had enough on hand to avoid a near-term impact.

But a prolonged shortage could force the company and other chip makers to accept supply from other locations, like Russia, the world’s third-largest producer of helium. Or it could force production cuts that would roll through everything from electronics to cars.

Human Suffering

Last week, a new U.N. report estimated that 8.8 million people in Asia and the Pacific are at risk of falling into poverty because of the warIt all depends on how long hostilities last. Most of those (~five million), would be in Iran. However, they are But in a region where most employment is informal, without a robust safety net, and the conflict’s effects are starting to compound for them.

In India, where entire industrial clusters have been shut down for weeks by fuel shortages, workers are reversing urbanization, melting back to rural villages to thresh wheat. The cost of acetaminophen and some antibiotics in India has already gone up.

In Manila, Wednesday is considered a special day of Catholic devotion that usually attracts a throng of devotees and shoppers in the Philippine capital’s Baclaran district. After attending church, many scout for bargains at the nearby flea market.

In the northern region of the Philippines, which supplies most of the country’s highland vegetables, like cabbage and broccoli, scarcity is killing abundance. Crops ready to be harvested last week are rotting in fertile fields, with farmers unable to afford the costs of transporting them to market.

The U.N.’s report predicted that the war would cost Asia and the Pacific between $97 billion and $299 billion, equivalent to between 0.3 and 0.8 percent of regional gross domestic product.

At street level, suffering often starts with higher food prices and reduced employment.

“You’re losing income, and at the same time you’re paying more,” said Ms. Wignaraja, the U.N. official.

In the northern region of the Philippines, which supplies most of the country’s highland vegetables, like cabbage and broccoli, scarcity is killing abundance. Crops ready to be harvested last week are rotting in fertile fields, with farmers unable to afford the costs of transporting them to market.

The war’s damage, so quick and deep across the Asia-Pacific, will not be easy to contain. Even if the United States and Iran reach a lasting peace, the forces of scarcity and inflation have gained momentum and are on the move. In drawing a comparison, Mr. Cornell from the Atlantic Council . . .

“You’ve seen tsunamis — they go across the ocean very, very fast. I find it breathtaking to see the degree to which American policymakers think that they are insulated.”