Asia’s Largest Oil Buyers Face Growing Straits of Hormuz Crisis

As tensions in the Persian Gulf escalate, Asia’s biggest economies are confronting a deepening energy security challenge. With the Strait of Hormuz effectively closed due to ongoing conflict, China and India — the world’s two largest oil importers — are seeing their workaround strategies falter as alternative supplies dwindle and stockpiles deplete.

For over seven weeks, Asian nations have relied on a mix of floating oil reserves, Russian shipments under U.S. Waivers and redirected cargoes to offset the loss of Gulf crude. However, recent reports indicate these buffers are rapidly diminishing. In mid-February, approximately 20 million barrels of Russian crude were available in floating storage. that volume has since declined significantly as tankers discharge cargo and fewer modern shipments arrive.

India remains particularly exposed. Beyond crude, the country depends on Gulf-sourced liquefied petroleum gas (LPG) for cooking fuel, where shortages have already become acute. While Chinese refiners report coverage for the coming month, they acknowledge that spot prices no longer reflect the deep discounts seen since 2022, and the window for securing affordable alternatives is narrowing.

Governments across the region have responded by curbing exports and drawing down strategic reserves. Thailand suspended crude and petroleum exports in early March, followed by China’s directive to major refineries to halt diesel and petrol shipments. Companies like Mangalore Refinery and Petrochemicals have similarly reduced fuel outflows. Japan and South Korea, though less dependent on Gulf oil than China or India, have emphasized their reliance on adequate stockpiles to manage short-term demand.

The Strait of Hormuz continues to carry about 19 million barrels of oil per day — roughly 20% of global seaborne trade. For Japan, Gulf exports supply 80% to 90% of its oil imports; for China, the share is 30% to 40%. LNG flows are equally critical: one-fifth of global liquefied natural gas passes through the strait, with 83% destined for Asian markets, primarily China, India, and South Korea.

Although China has diversified through Russian pipelines and Central Asian imports, and maintains substantial domestic production, analysts note that Gulf dependency remains structurally high. As floating storage diminishes and diplomatic efforts to ease the blockade stall, the region’s energy shock is transitioning from a managed disruption to a tangible threat to industrial activity and household energy access.