Malaysia among hardest hit in Asean from Gulf oil disruption, says report

2026-03-23 - 08:11

Iran closed the Strait of Hormuz following the US-Israel strikes earlier this month, leading to crude oil surging to around US$100 per barrel. (EPA Images pic) PETALING JAYA: The Philippines, Vietnam and Malaysia are the three Asean countries most exposed to supply risks stemming from the Middle East conflict as they depend heavily on crude oil from the Persian Gulf, says Maybank Investment Bank (Maybank IB). Maybank IB said the region’s reliance on external energy sources underscores its exposure to supply shocks, particularly in scenarios where major producers or refiners impose export restrictions to safeguard their domestic needs. Maybank IB said the Philippines’ exposure to crude oil imported from the Persian Gulf stands at 95%, followed by Vietnam (88%), Malaysia (69%), Thailand (59%) and Singapore (52%), reported Bernama. Indonesia has a more diversified import profile, with only 20% of its crude oil sourced from Gulf countries. “The Philippines is considered the most vulnerable given its near-total reliance on imported oil and its overwhelming dependence on Persian Gulf suppliers,” said Maybank IB in a research note. Compounding these risks is China’s move to curb exports of refined petroleum products such as diesel, petrol and jet fuel, said Maybank IB. While most of its output is consumed domestically, China exported 5.8 million tonnes of refined products in 2025, with key markets including Singapore, Vietnam, Japan and South Korea. Beyond oil and gas, Maybank IB highlighted that the Persian Gulf is a major global source for several critical commodities that feed directly into petrochemical, mining, construction, transport and agricultural supply chains. It added that Thailand is heavily reliant on nitrogen fertilisers from the Gulf, with 67% of Thailand’s nitrogen fertiliser imports sourced from the Gulf as of 2024. This was followed by the Philippines (10%) and Malaysia (7%). The government had raised the price of RON97 petrol by RM1.30 in the past two weeks in the country, while diesel in West Malaysia has gone up by RM1.60. The price of non-subsidised RON95 has also gone up by 60 sen. Putrajaya estimates that keeping the subsidised fuel prices will increase its monthly fuel subsidy bill from RM700 million to RM3.2 billion, comprising RM2 billion for RON95 and RM1.2 billion for diesel. Diesel continues to be sold at a subsidised price in East Malaysia. Iran closed the Strait of Hormuz following the US-Israel strikes earlier this month, leading to crude oil surging to around US$100 per barrel.