Energy shocks are once again rippling across global markets and Asia sits on the front line.

The escalating conflict in the Middle East has already triggered the largest surge in global natural gas prices since the Russia-Ukraine conflict in 2022. For Asia’s import-dependent economies, the risks are immediate: Roughly 87% of crude oil and 86% of liquefied natural gas transiting the Strait of Hormuz is bound for Asian markets.

The disruption is already visible in shipping routes and prices. Major Japanese LNG shipping operators including Nippon Yusen, Mitsui O.S.K. Lines and Kawasaki Kisen Kaisha have instructed vessels to avoid or wait near the Persian Gulf as security risks rise. As Asian buyers scramble for replacement cargoes on the spot market, the cost of transporting LNG from the Atlantic basin to Asia has surged to around $264,000 per day, roughly six times higher than in late February.

© The Japan Times