HANOI, Vietnam (AP) – The ongoing conflicts in the Middle East, particularly the war between Israel and Iran, have highlighted Asia’s significant dependence on oil and gas imports from the region. This reliance, especially on deliveries through the strategic Strait of Hormuz, poses a threat to energy and economic security for several Asian nations, notably Japan and South Korea, which have been slow to transition towards renewable energy sources.
The Strait of Hormuz is crucial for global energy supplies, with approximately 20% of the world’s oil and liquefied natural gas (LNG) passing through it. Notably, four countries—China, India, Japan, and South Korea—account for a staggering 75% of these imports. While China and India are the largest consumers of oil and LNG flowing through the strait, Japan and South Korea are deemed more vulnerable due to their high dependence on fossil fuel imports.
According to research from Zero Carbon Analytics, Japan relies on imported fossil fuels for 87% of its energy consumption, while South Korea imports 81%. In contrast, China and India depend on 20% and 35% of their energy needs, respectively. This stark contrast underscores the heightened risk faced by Japan and South Korea, particularly since a large portion of their oil—three-quarters for Japan and over 70% for South Korea—transits through the strait.
Both Japan and South Korea have emphasized diversifying their fossil fuel sources instead of accelerating the shift towards renewable energy. Japan aims to derive 30-40% of its energy from fossil fuels by 2040 and is actively constructing new LNG plants while replacing older ones. Meanwhile, South Korea intends to generate 25.1% of its electricity from LNG by 2030, a slight decrease from the current 28%, aiming for an even further reduction to 10.6% by 2038.
To meet their respective targets for achieving net-zero carbon emissions by 2050, Japan and South Korea must significantly increase their capacity for solar and wind energy. This entails adding roughly 9 gigawatts of solar power annually through 2030. Additionally, Japan requires an influx of 5 gigawatts of wind energy each year, while South Korea’s target stands at about 6 gigawatts.
However, Japan's energy framework remains inconsistent, featuring ongoing subsidies for gasoline and diesel, increasing LNG imports, and support for overseas oil and gas projects. The regulatory barriers faced by Japan's offshore wind initiatives further complicate its climate objectives. As Tim Daiss from APAC Energy Consultancy articulated, Japan's measures are inadequate and often suboptimal, particularly its approach to hydrogen fuel derived from natural gas.
South Korea's challenges include low electricity prices, which inhibit the scalability of solar and wind technologies, as noted by Kwanghee Yeom of Agora Energiewende. To bolster investments in renewable energy, the nation requires fair pricing strategies and stronger policy support.
In contrast, both China and India have implemented steps to mitigate their exposure to fluctuating global energy prices. China has achieved significant growth in wind and solar energy, showing increases of 45% and 18% in generating capacities, respectively, while also ramping up domestic gas production. Although China remains the world’s largest oil importer—half of its 11 million barrels per day sourced from the Middle East—it has actively reduced its LNG imports.
India still leans heavily on coal, aiming for a 42% increase in coal production by 2030, but it is also enhancing its renewable capacity, adding 30 gigawatts of clean energy last year. By diversifying its energy suppliers to include imports from the U.S., Russia, and other Middle Eastern countries, India has begun to reduce its risks, although Vibhuti Garg from the Institute for Energy Economics and Financial Analysis emphasizes that further progress on renewables is essential for true energy security.
Moreover, a potential blockade of the Strait of Hormuz could disrupt not only the directly reliant nations but also the broader Asian region. Building renewable energy capacity will serve as a critical buffer against the inherent volatilities of importing fossil fuels. The ASEAN Centre for Energy has noted that Southeast Asia is transitioning into a net oil importer, driven by increasing demand that outstrips local production in Malaysia and Indonesia, and the region is expected to become a net LNG importer by 2032.
The International Energy Agency's warning that ASEAN's oil import costs could escalate from $130 billion in 2024 to over $200 billion by 2050, if clean energy initiatives are inadequate, underscores the urgency for policy reforms. Ensuring national energy security necessitates a committed transition towards clean energy solutions.
