Asia races to stockpile oil, speed up renewables in response to Iran war

• The Philippines will create a national oil reserve by end of 2027 that could later become a regional stockpile, with priority access for the host country during emergencies
• ASEAN members are targeting 30% renewables in primary energy supply and 45% in installed capacity, up from current levels of 14.1% and 33.7% respectively, making the region a major laggard in green energy
• Countries reached enhanced agreement on a regional power grid first proposed in 1997, with plans to accelerate implementation from the original 2045 target

Summary: Asian Nations Accelerate Oil Stockpiling and Renewable Energy Plans Amid Iran War

Key Developments:

Asian countries are urgently expanding oil reserves and accelerating renewable energy initiatives in response to supply disruptions from the Iran war. Southeast Asia faces the most severe impact, as the region previously received 80% of oil shipped through the Strait of Hormuz.

Major Initiatives:

• Philippines will establish a national oil reserve by end of 2027, which may later convert to a regional stockpile
• ASEAN members (nine Southeast Asian nations) are developing voluntary joint oil stockpiling systems with support from Japan and Australia
• Japan's Asia Zero Emission Community (AZEC) has secured cooperation agreements with Saudi Arabia and UAE to strengthen regional oil reserves
• ASEAN reached an enhanced agreement on a long-delayed regional power grid, first proposed in December 1997

Renewable Energy Targets:

ASEAN nations committed to ambitious green energy goals:

• 30% renewables in primary energy supply
• 45% renewables in installed capacity

Current Performance Gap:

The region significantly trails its climate commitments:

• Renewables currently represent just 14.1% of primary energy versus a 2025 target of 25%
• Green power comprises 33.7% of total capacity since 2020, below the 35% target for 2025

Market Implications:

The coordinated regional response signals heightened energy security concerns across Asia's major economies. Priority access arrangements for host countries storing regional reserves could reshape oil trading patterns. The accelerated power grid implementation timeline (reduced from original 2045 target) indicates urgency in diversifying energy infrastructure amid geopolitical volatility.