Southeast Asian countries could face sharply rising energy costs unless they accelerate efforts to diversify their energy supplies, according to a new report released on Tuesday by the International Energy Agency (IEA).
The report says disruptions linked to the US-Israeli war on Iran, including the closure of the Strait of Hormuz, triggered an energy shock across the region, leading to higher fuel costs and increased inflation.
In response, several countries have expanded investment in alternative energy sources, with rising electric vehicle sales, renewed interest in nuclear power and rapid growth in rooftop solar and other renewable energy projects.
However, the IEA warned that without broader structural reforms, the region’s annual energy import bill could rise from $80bn in 2024 to $245bn by 2035.
The report also noted that the conflict has reinforced reliance on coal during periods of supply disruption, complicating efforts to reduce fossil fuel use.
“Diversification of energy sources and supply routes is now a central priority,” IEA Executive Director Fatih Birol said.
