Deutsche WelleConflicts Asia Is Russian oil becoming a lifeline for Southeast Asia? David Hutt May 7, 2026
With oil, gas and fertilizer imports squeezed by the Iran war, Southeast Asian governments are brushing off EU pressure and treating Russian energy as a tool of economic survival.
As Southeast Asian governments scramble to respond to the unprecedented energy crisis, the EU is turning up the pressure to keep them from buying Russian energy.
Despite years of Western sanctions, Russia remains one of the top energy suppliers on the global stage. It is the world’s second-biggest oil exporter, behind Saudi Arabia, and the second-biggest gas exporter, trailing only the US.
Crucially, Russia’s geography allows it to export its energy without passing through the Strait of Hormuz, which has been disrupted by the US-Israel war against Iran.
Last week, EU foreign policy chief Kaja Kallas warned Southeast Asian countries not to turn to Russian oil. After meeting foreign ministers from the Association of Southeast Asian Nations (ASEAN) in Brunei, Kallas said increased purchases of Russian oil would help Moscow fund its war in Ukraine.
The EU’s top diplomat also made a point of saying that Brussels was not trying to punish Southeast Asian governments or companies directly, but was instead hoping to shrink Russian oil revenues.
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Yet the warning comes as several Southeast Asian capitals face threats to fuel security and food production, overshadowing the diplomatic fallout of the war in Ukraine.
“Faced with a severe energy crisis that could upend their economies and trigger street protests, some Southeast Asian governments will prioritize oil supplies over what they perceive as a faraway conflict in which they don’t have a direct stake,” Ian Storey, senior fellow at the ISEAS-Yusof Ishak Institute in Singapore, told DW.
Indonesia, Philippines already buying Russian oil
The region consumes around 5 million barrels of oil per day but produces only about 2 million, forcing it to buy the rest on the global energy market. Most of its oil imports come from the Middle East.
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Indonesia announced last week that it will import around 150 million barrels of Russian crude oil this year, following President Prabowo Subianto’s visit to Moscow.
The Philippines, considered a US ally in the region, received a shipment of Russian crude in March — the first such delivery in five years. Manila also asked Washington to extend a sanctions waiver that would allow further purchases.
Thailand has been exploring ways to secure fertilizer and other agricultural inputs from Russia, while Vietnam has sought alternative fuel supplies after China and Thailand restricted exports of refined fuel. Hanoi relies on China and Thailand for more than 60% of Vietnam’s jet fuel needs.
Oil imports sink to 2015 levels
The war in the Middle East has created the largest supply disruption in the history of the global oil market, with crude and oil-product flows through the Strait of Hormuz plunging from around 20 million barrels per day before the war to a trickle, according to the International Energy Agency.
The first month after Russia’s February 2022 invasion saw Brent crude prices rise from $95 to $115 (€80.7 to €97.7) per barrel, a 21% jump.
By contrast, the ongoing crisis in the Middle East has seen Brent rise from $71 to $103 in March, marking a rise of nearly 27%, which was followed by another jump in April, bringing the benchmark price to some $120 per barrel before dropping amid hopes of an agreement to end the conflict.
Southeast Asian crude imports fell 30% year-on-year in April, their lowest level since 2015, according to data assembled by Kpler, a Belgium-based analytics firm.
ASEAN nations warn that living costs are already rising across the region, with low-income households and small businesses hit hardest.
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Southeast Asian governments have moved quickly in the wake of the US and Israel attacking in Iran in late February.
The Philippines has declared a one-year national energy emergency, created a contingency committee for fuel and essential goods. Despite these measures, however, inflation spiked to 7.2% last month, up from 2.4% in March, according to government data.
Indonesia has leaned on administered prices and subsidies, allocating $22.4 billion for energy subsidies and compensation, while Thailand has frozen cooking-fuel prices until May and tapped its oil fund to hold down fuel costs.
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Malaysia has also absorbed much of the shock through subsidies, with its monthly fuel subsidy bill reportedly rising from around $179 million in January to as much as $1.5 billion.
Weeks into the Iran war, Philippines’ authorities said the nation had enough fuel for some 45 days. On March 25, President Ferdinand Marcos Jr said he was “fairly confident” that the nation had ensured additional shipments that would keep its inventory stocked.
With the original deadline about to expire, the crisis is already entering daily life. The country’s transport groups and consumer organizations have threatened strikes over fuel costs, raising the risk of disruption in cities where commuters depend heavily on buses, minibuses and motorcycle taxis.
In Vietnam, aviation authorities warned airlines to prepare for domestic flight reductions starting in April, following China and Thailand’s halt of jet fuel exports.
Across the region, farmers are being squeezed by higher diesel and fertilizer costs, with rice producers in Thailand, Vietnam, the Philippines and Indonesia already reconsidering planting plans.
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Indra Overland, head of the Center for Energy Research at the Norwegian Institute of International Affairs, told DW that today’s crisis is larger than the oil shocks of 1973 and 1979, as well as other previous oil shocks, because oil, LNG, and fertilizer markets are tightening simultaneously.
Unlike past price spikes, this crisis is unfolding alongside Ukraine’s increasingly effective attacks on Russian oil and gas infrastructure, which further reduces the room for alternative supply, he said.
The fundamental difference between this crisis and previous energy shocks is that it is not just about higher prices but also about shortages, Rogelio Alicor Panao, professor of political science at the University of the Philippines Diliman, told DW.
“This means countries cannot simply pay more to get what they need. Instead, they may run out of fuel or energy,” Panao added.
Fertilizer shortages hit food production
The fertilizer squeeze makes the crisis especially dangerous for Southeast Asia, where food prices are politically sensitive, and many governments still remember the social unrest caused by past inflation spikes.
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Russia accounts for about a quarter of regional fertilizer imports, while China, previously the largest single-country exporter of fertilizer to Southeast Asia, has also cut off exports, “so Southeast Asian countries are feeling the squeeze,” Hunter Marston, director for Southeast Asia at the Lowy Institute, told DW.
Countries that heavily subsidize energy and electricity and are less dependent on imports, such as Indonesia, Thailand and Malaysia, have so far been better able to contain inflation and commodity-price increases since the crisis began at the end of February, Alloysius Joko Purwanto, senior energy economist at the Economic Research Institute for ASEAN and East Asia, told DW.
But countries with more market-based pricing, such as the Philippines, or higher import dependence, such as Laos and Cambodia, have seen sharper inflation or consumer-price increases, he added.
Best-case scenario means months of disruption
The IMF has urged Asian governments to keep support targeted, warning that broad price caps and subsidies can strain public finances even as they soften the immediate blow for households.
Even if the conflict ends tomorrow, bringing oil and gas production back to “normal” will take six months or more, Sam Reynolds, research lead at the Institute for Energy Economics and Financial Analysis, told DW.
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One likely event will be increased competition between European and Asian buyers of LNG and oil, especially as European gas storage is currently only 30% full but needs to reach 90% capacity by October, Reynolds said.
But this energy crisis is unprecedented, “and I’m not sure anyone can say with any certainty how bad things will get,” he added.
Edited by: Darko Janjevic
