Rystad Energy

How the Middle East War Is Reshaping Asia’s Upstream Strategy, with Prateek Pandey

The podcast examines how the Israel‑Iran‑U.S. conflict is forcing Asian energy planners to rethink upstream strategies. With roughly 55‑60% of the region’s oil and 70% of its LNG imports coming from the Gulf, any disruption to the Strait of Hormuz creates immediate supply shocks, prompting governments to declare emergencies, tap strategic reserves, and explore demand‑reduction measures. Analysts note that countries such as Pakistan and the Philippines are most exposed—over 95% of their oil and nearly all LNG imports originate in the Middle East—while India and China each source 50‑60% of crude from the region. National oil companies are scrambling to lift production by 3‑5% through well interventions and to negotiate new gas‑sale agreements, while international majors are shifting focus toward Asian gas basins, especially Indonesia, Malaysia, and the Andaman deep‑water prospects. Prateek Pandey highlights that the crisis underscores the strategic value of domestic resources. Recent discoveries in the Andaman Basin and large gas finds in Indonesia have reignited interest from IOCs and independents, who see faster‑to‑market projects with existing infrastructure as a hedge against geopolitical risk. However, pipeline bottlenecks and limited regasification capacity—particularly in Indonesia—remain critical constraints that could blunt the benefits of new upstream supply. The broader implication is a pivot toward regional self‑sufficiency, even if it comes at higher cost. Investors are likely to see increased capital flows into Asian upstream and midstream assets, while consumers may face pricier energy as the market adjusts to a less reliable global supply chain.