TEHRAN, July 19 — The ongoing military confrontation between the United States and Iran is sending shockwaves through global energy markets, with consequences that reach deep into Asia’s fuel-dependent economies. Brent crude, the international benchmark, surged 12.6% within a week in April 2024, climbing from $82 to $92.35 per barrel. West Texas Intermediate similarly pushed above $88.
For communities across Asia that rely heavily on imported oil to power transport, industry and households, every dollar increase in crude prices translates directly into higher living costs and business expenses.
Strait of Hormuz at the centre of the crisis
At the heart of the market jitters lies the Strait of Hormuz, a narrow 33-kilometre waterway between Oman and Iran. This chokepoint carries roughly 21 million barrels of oil per day — about 21% of global petroleum consumption. Iran has repeatedly threatened to block the strait if attacked, a scenario that would cut off a fifth of the world’s oil supply.
The mere risk of such disruption is already reshaping the economics of shipping in the region. Insurance markets are reacting sharply.
According to the London insurance market, war-risk premiums for vessels transiting the Persian Gulf are 30% higher than before the crisis. This is a stark echo of 2019, when a US drone shootdown caused insurance rates for tankers in the Gulf to surge tenfold. Higher premiums mean higher shipping costs, and those costs eventually land on consumers across Asia — from Manila to Mumbai — who pay more for fuel, goods and transport.
Iran’s oil exports and Asia’s reliance
Iran remains a significant player despite years of US sanctions. In 2023, the country exported 1.5 million barrels per day of crude, with the vast majority going to China. Those shipments continue, but the risk of supply interruptions has grown as the military standoff intensifies.
Major producers Saudi Arabia and the United Arab Emirates have so far maintained their exports, though both have publicly warned of potential disruptions. For Asian nations that already compete with China for Iranian crude, any further tightening in supply could squeeze refineries and push up fuel prices at the wholesale level.
Limited cushion: US strategic reserves at historic low
The ability of the United States to stabilise prices through its Strategic Petroleum Reserve is severely constrained. As of March 2024, the reserve held 370 million barrels — the lowest level since 1983. This limited cushion reduces the US government’s capacity to release oil into the market during a supply emergency, meaning that any actual disruption in Hormuz would likely have a more immediate and severe impact on prices.
The International Energy Agency has estimated that a full closure of the Strait of Hormuz could send oil prices spiking to between $140 and $180 per barrel within weeks. Such a surge would be devastating for Asian economies that import most of their oil.
Already, US gasoline prices averaged $3.64 per gallon nationally in April 2024, and analysts project they could rise by 15 to 20 cents per gallon if the conflict continues. While the direct impact on Asian fuel markets varies by country, the trend is unmistakably upward. What this means for families and businesses across the region is a period of uncertainty.
Higher oil prices drive up the cost of electricity, transport and manufactured goods — putting pressure on household budgets already stretched by inflation. For economies that depend on remittances from workers in the Gulf, the crisis also threatens to disrupt labour markets and regional stability.
As the confrontation between Washington and Tehran shows no sign of de-escalation, the world’s attention remains fixed on that 33-kilometre strait. With insurance costs climbing, strategic reserves at historic lows, and the risk of a full blockade looming, the price of oil — and the cost of everyday life for millions across Asia — hangs in the balance.
Sources
{“@context”: “https://schema.org”, “@type”: “NewsArticle”, “headline”: “US-Iran strikes drive crude prices up, threaten Hormuz Strait”, “description”: “TEHRAN, July 19 — The ongoing military confrontation between the United States and Iran is sending shockwaves through global energy markets, with consequences that reach…”, “datePublished”: “2026-07-19T09:30:00+00:00”, “author”: {“@type”: “Person”, “name”: “Merry Gel Sigui”}, “publisher”: {“@type”: “Organization”, “name”: “InfoPulse Today”, “url”: “https://newsfeed.infopulsetoday.com/”}, “citation”: [{“@type”: “CreativeWork”, “url”: “https://en.wikipedia.org/wiki/Oil_and_gas_industry_in_Iran”}]}
