Asian Nations Implement Energy Rationing Amid Global Oil Price Surge
Energy Conservation Measures Across Asia
In response to disruptions in fuel supply and escalating global oil prices due to the ongoing conflict in West Asia, several Asian countries have initiated rationing and other energy-saving measures.
Bangladesh Takes Emergency Actions
Bangladesh has decided to close all universities starting Monday and has advanced the Eid al-Fitr holidays as part of its emergency strategy to conserve fuel and electricity. This move is also expected to alleviate traffic congestion, which contributes to fuel wastage, according to local authorities. The nation relies on imports for 95% of its energy needs.
On Friday, Dhaka implemented a daily limit on fuel sales following reports of panic buying and hoarding.
A shortage of gas has already forced the country to cease operations at several state-run fertilizer plants, with available gas redirected to power generation.
Southeast Asia's Response
Myanmar's military government has introduced an “odd-even” rationing system for private vehicles, allowing cars with even-numbered plates to operate on even dates and odd-numbered plates on odd dates. Electric vehicles are exempt from this rule.
In the Philippines, civil servants have been instructed to work four days a week to reduce fuel consumption.
Vietnam's government has proposed to eliminate tariffs on imported fuels until the end of April to stabilize the domestic petroleum market and ensure energy security.
In Western Australia, some towns have begun rationing fuel, limiting sales to emergency services and essential needs.
South Korea has announced plans to cap local fuel prices to maintain price stability for petroleum products, marking the first such action since 1997.
Similarly, Taiwan has set a weekly cap on oil price increases to mitigate the economic impact of the conflict.
In Thailand, Prime Minister Anutin Charnvirakul has urged citizens against stockpiling fuel and announced plans to limit diesel prices for approximately two weeks.
In India, the price of liquefied petroleum gas saw an increase of Rs 60 per domestic cylinder recently.
Global Oil Prices Surge
Global oil prices have surged, surpassing the $100 per barrel mark, reaching the highest levels since July 2022. The price of benchmark Brent crude rose to $116 per barrel before settling around $104, compared to $72.8 per barrel just before the conflict began.
Prices have increased by approximately 50% since the onset of the conflict, raising concerns about potential disruptions in shipments through the Strait of Hormuz, a critical maritime route for global petroleum.
Bahrain's state-owned energy company Bapco has declared force majeure due to operational disruptions caused by the conflict and a recent attack on its refinery, although local supply remains unaffected.
This declaration follows a similar announcement from QatarEnergy, which operates all oil and gas activities in Qatar.
Conflict in West Asia
The conflict in West Asia escalated after Israel and the United States launched attacks aimed at degrading Iran's capabilities, prompting retaliatory strikes from Tehran against Israel and US military bases in the region.
The tensions have been exacerbated by concerns over Iran's nuclear program, with the US acting as a guarantor of Israel's security.
In a recent development, the US granted Indian refiners a 30-day waiver to purchase Russian oil stranded at sea, a temporary measure to ensure global oil supply continuity.