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OTC Asia 2026: Supply Chains, Deepwater and Energy Security, with Afiqah Mohd Ali

Rystad Energy
Rystad Energy•May 5, 2026

Why It Matters

Regional energy security now hinges on building local supply‑chain capacity; without it, project costs rise and timelines slip, eroding competitiveness.

Key Takeaways

  • •Middle East conflict's supply impact remains localized, limited regional spillover.
  • •Aluminum prices surged 70‑80% in Asia due to rising premiums.
  • •Deepwater projects dominate 2026‑2029 Southeast Asia pipeline, needing FPSOs.
  • •Regional yards lack capacity; Chinese yards supply 70‑90% of FPSO hulls.
  • •Governments invest in digitalization to boost local shipyard capabilities.

Summary

The OTC Asia 2026 panel, featuring Rystad Energy analyst Afiqah Mohd Ali, examined how recent Middle‑East tensions and broader geopolitical shifts are reshaping energy‑related supply chains in Southeast Asia. The conversation centered on the immediate, largely localized impact of the conflict, the surge in commodity prices, and the region’s evolving deep‑water development agenda.

Ali noted that while the conflict has not yet caused widespread regional disruption, it has tightened the availability of rigs and vessels, keeping rates stable for now. More striking, however, is the near‑term 70‑80% jump in delivered aluminum costs to Asia, driven by heightened premiums. Looking ahead to 2026‑2029, deep‑water projects will dominate capital spending, demanding a surge in FPSO capacity—a segment where regional yards currently lack the scale and expertise.

The panel highlighted that Chinese shipyards now construct 70‑90% of FPSO hulls, with South Korean and Japanese yards also playing significant roles. Local yards in Indonesia, Malaysia, and elsewhere struggle to meet demand, prompting calls for government‑backed investment and digitalization. Petronas, for example, is reportedly funding upgrades to Malaysian yards, mirroring China’s state‑driven push toward robotics and advanced manufacturing.

These dynamics signal a strategic imperative for Southeast Asian operators: diversify supply sources, accelerate near‑shoring of critical assets, and invest in modernizing domestic shipyards. Failure to do so could leave the region vulnerable to price spikes and project delays, while proactive measures may secure a competitive edge in the coming wave of deep‑water developments.

Original Description

Recorded at OTC Asia 2026 in Kuala Lumpur, Noah Brenner speaks with Afiqah Mohd Ali, Senior Analyst, Supply Chain Research at Rystad Energy, about how supply chain risks and opportunities are evolving across Southeast Asia’s offshore sector.
The conversation explores how the Middle East conflict is affecting regional supply dynamics, where inflationary pressure could emerge further down the supply chain, why deepwater developments and FPSOs matter for Southeast Asia’s next offshore wave, and how yard capacity, digitalization and local capability-building tie into long-term energy security.
In this interview:
+ How the Middle East conflict is affecting rigs, vessels and commodity costs
+ Why aluminum and other materials are worth watching in the months ahead
+ Where Southeast Asia’s deepwater project pipeline is building
+ Why FPSO construction capacity is a key supply chain bottleneck
+ How local yards, digitalization and supplier development support energy security
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