ASEAN Energy Ministers Tackle Supply Crisis as Iran War Exposes Region's Dependence on Middle East Oil

Southeast Asia's energy ministers are gathering in Manila this week for two days of talks aimed at strengthening regional energy security, as the ongoing US-Israel war on Iran continues to disrupt global fuel supply chains and expose the bloc's heavy reliance on Middle Eastern oil.

The Association of Southeast Asian Nations (ASEAN) meeting, scheduled for Wednesday and Thursday, will focus on a range of cooperative initiatives, including a proposed framework for fuel sharing and long-discussed plans to integrate the region's electricity grids. The talks come as member states grapple with the fallout from a conflict that has effectively shut down the Strait of Hormuz, a critical maritime chokepoint through which a substantial share of the region's energy imports once flowed.

Before the war erupted in late February, ASEAN's eleven member states sourced roughly half of their oil needs from the Middle East, leaving their economies acutely vulnerable to supply interruptions. The closure of the strait has forced governments across the region to confront the fragility of their energy supply lines and accelerate efforts to diversify away from a single, conflict-prone source.

The Philippines, which currently holds the rotating ASEAN chairmanship, declared a national energy emergency within weeks of the war's outbreak, after officials warned that domestic fuel reserves could be depleted within 45 days. Other member states, including Thailand, Vietnam, Indonesia and Cambodia, have rolled out a patchwork of conservation measures, ranging from expanded work-from-home arrangements to fuel rationing, in an effort to stretch dwindling supplies.

Philippine Energy Secretary Sharon S Garin framed the chairmanship as a chance to convert years of dialogue into concrete arrangements. In a statement issued ahead of the meetings, she noted that developments in global energy markets can quickly reach the region's shores, driving up fuel costs, disrupting industrial activity and squeezing household budgets. Garin said the ASEAN chairmanship offers an opportunity to translate regional cooperation into practical mechanisms that bolster the bloc's collective capacity to prepare for and absorb future shocks.

The pressures facing ASEAN are not solely the product of the Iran conflict. According to the International Energy Agency (IEA), Southeast Asia's per capita energy demand has climbed by nearly 30 percent over the past decade, even as regional oil production has tumbled by 40 percent from its peak in the 1990s. The region, home to more than 700 million people, is projected to see electricity demand grow by an average of 5.4 percent annually between 2026 and 2030, according to the IEA, a trajectory that will require massive investment in generation, transmission and efficiency.

IEA Executive Director Fatih Birol warned in a statement on Monday that Southeast Asia will struggle to meet its rising energy needs amid what he described as an uncertain global energy landscape. Birol stressed that energy security considerations must be woven into decisions across the entire system, from oil stockpiles and gas infrastructure to electricity grids and more efficient energy use. He added that closer cooperation among ASEAN countries would allow them to make better use of their collective resources and respond more effectively when disruptions occur.

The agenda in Manila reflects the varied priorities that member states bring to the table. Dinita Setyawati, head of Southeast Asia research at the energy think tank Ember, told Al Jazeera that the Philippines is likely to push for secured funding and governance arrangements to advance its participation in the ASEAN Power Grid, including oversight of undersea cable connections. Singapore, she said, is expected to focus on locking in commitments from neighbouring countries to export clean electricity, citing existing plans for Singapore-Indonesia interconnections. Other members, according to Setyawati, are keen to develop a regional carbon market as a means of expanding financing for clean energy projects.

Despite decades of declarations and roadmaps, ASEAN has consistently fallen short of its ambitions for deeper energy integration. Only nine of the 18 projects designated as priorities under the ASEAN Power Grid initiative have been completed since the plan was first floated in the late 1990s. Unlike the European Union, ASEAN operates without a central supranational authority and cannot pass or enforce binding laws, a structural weakness that critics argue has hobbled the bloc's ability to deliver on collective goals.

Laurence Delina, an associate professor at the Hong Kong University of Science and Technology who specialises in Southeast Asian energy policy, said the gap between ASEAN's rhetoric and its achievements has persisted for years, with cooperation largely confined to bilateral energy-sharing agreements. Delina told Al Jazeera that ASEAN lacks the enforcement power enjoyed by the European Union. He described the integration of the region's energy grid as a challenge that is as much political as it is technical, adding that he is uncertain whether such a system will materialise within his lifetime. Although Southeast Asia is a region, he noted, the conditions across its constituent countries differ so widely that it does not function as a genuine regional market.

Setyawati, however, expressed optimism that the ministers will commit additional funding to renewables and electrification as a way of reducing the region's dependence on imported fuels. She pointed to current data showing that electrification accounts for only around 25 percent of Southeast Asia's total final energy consumption, suggesting considerable room for growth if the political will exists.

The Manila meetings will also be watched closely by analysts assessing whether the shock of the Iran war can succeed where previous crises failed in pushing ASEAN toward meaningful collective action. With the bloc's combined gross domestic product exceeding $4.2 trillion, it ranks among the world's fastest-growing economic groupings. Yet that growth depends on reliable, affordable energy, and the war has laid bare how quickly external shocks can reverberate through the region's economies. For ASEAN's energy ministers, the task this week is to demonstrate that regional cooperation can move beyond communiques and deliver arrangements robust enough to withstand the next disruption.