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The Hormuz disruption is a global supply shock, with one-fifth of global oil and LNG flows affected, driving price spikes, inflation risks and heightened macro volatility. Disproportionately exposed, Asia’s heavy reliance on the Middle East could lead to energy shortages, industrial disruption and higher inflation.
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All eyes on the Middle East.
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With shipping traffic via the Straits of Hormuz now having come to a near standstill due to the war between US-Israel forces and Iran, oil, LNG and petrochemical prices have spiked due to this supply shock. As a net importer of energy, Asia has started to feel the effects with many countries starting to take action to conserve energy with sporadic news reports of gasoline and diesel shortages due to hoarding.
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In Singapore, the MAS warned of higher energy prices impacting its 2026 inflation forecast of 1-2%; thus, it is likely to tighten its monetary policy in April, allowing the S$to strengthen faster against a basket of currencies.
How to play higher oil prices in Singapore ?
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At present, our 2026 earnings estimate has factored in a Brent oil price of US$71/bbl vs the current year-to-date average of US$77/bbl. Every US$1/bbl increase in the company’s realised oil price would raise its earnings by 5.6%, ceteris paribus.
Avoid Rex International.
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Above is an excerpt from a report by UOB Kay Hian Research.
Clients of UOB Kay Hian may be the first to access the full PDF report @ https://www.utrade.com.sg/.
Adrian LOH UOB Kay Hian Research | https://research.uobkayhian.com/ 2026-03-30
More views on outlook of offshore & marine sector:
Analyst Reports on Singapore Offshore & Marine Sector
