Asian nations are bracing for high costs and shortages of gas from the Iran war as the flow of energy products to Asia through the Strait of Hormuz has been interrupted by threats from Tehran.
Roughly 20 percent of the world’s oil and liquefied natural gas (LNG) flows through the Strait of Hormuz, the narrow waterway linking the Persian Gulf with the Gulf of Oman. The strait is only about two nautical miles wide at its narrowest point, and ships passing through it are exposed to attack from the mountainous Iranian coast.
Asia gets about a third of its LNG and 60 percent of its crude oil through the Strait of Hormuz, so it is especially nervous about the loss of shipping. Vietnam buys 87 percent of its oil from the Persian Gulf, while India obtains half of its imports from the region.
On Tuesday, the Vietnamese trade ministry asked employees to begin working from home to cut down on fuel consumption. The ministry also asked consumers and businesses not to hoard fuel.
Reuters noted that gas prices in Vietnam have risen by 32 percent since the end of February and long lines have appeared at pumping stations in Hanoi. The Vietnamese government announced it would remove import tariffs on fuel, which can range up to 20 percent, until the end of April to bring prices down.
On Tuesday, Vietnam said it would tap into its $200 million Fuel Price Stabilization Fund for the first time since 2023. The government also asked citizens to use public transportation instead of personal vehicles.
Meanwhile, India’s restaurant and hotel industries warned of widespread disruptions due to a shortage of cooking gas. Some restaurants said they only had enough gas to stay running for a few days.
“The restaurant industry is predominantly dependent on commercial LPG [liquefied petroleum gas] for its operations. Any disruption therein will lead to a catastrophic closure,” warned the National Restaurant Association of India (NRAI).
NRAI Vice President Zorawar Kalra predicted the industry could lose over $130 million a day if gas supplies are restricted or prices continue to soar. Restaurants in India vastly prefer to cook with gas, but some said they would temporarily use electric ovens and trim their menus until gas supplies return to normal.
Indian government officials said on Tuesday there was “no need to panic.” The government said it has widened its procurement strategy from the usual 27 countries to about 40, to ensure energy needs are met.
Australia’s ABC News reported Bangladesh has imposed daily limits on fuel sales, South Korea is putting a cap on domestic fuel prices, Japan is considering a price cap, Pakistan just announced its biggest-ever spike in pump prices, and the Philippines has implemented an emergency four-day work week to reduce consumption.
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