Will Hormuz crisis spur Asia to boost oil reserve cooperation?
The closure of the Strait of Hormuz has raised energy security concerns across Asia, potentially spurring regional cooperation on strategic oil reserves. Experts suggest establishing regional mechanisms for shared storage and information-sharing.
Regional nations—Japan, South Korea, India, Thailand—import 85 percent of their oil consumption, most passing through the Strait of Hormuz. During the war, supply concerns, price spikes, and disruptions occurred. This demonstrated that Asia needs its own oil security strategy.
Japan is well-endowed with strategic oil reserves and LNG storage facilities. South Korea and India have fewer such facilities. Regional cooperation could enable more efficient sharing of these resources. Transit centers like Singapore could become strategic storage hubs.
However, this cooperation may conflict with China's interests. China has a stake in opening the Strait due to its close ties with Iran. Asia developing regional security mechanisms could also reshape US-China geopolitical competition.
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