Conflict escalation near Strait of Hormuz triggers one of most intense oil price rallies since 2022: Petronas
KUALA LUMPUR: The escalating conflict near the Strait of Hormuz has triggered one of the most intense oil price rallies since 2022, said Petroliam Nasional Bhd (Petronas) CEO Tan Sri Tengku Muhammad Taufik.
'In the past few days, the escalation of conflict around the Strait of Hormuz where 18 to 19 million barrels of oil – or 20% of the total global supply – flow through every day, have sent prices surging in anticipation of a supply shock,' he said in his welcoming speech at Energy Asia 2025 today.
Tengku Muhammad Taufik said this is unfolding at a time when the world is still reeling from the US reciprocal tariffs.
'Today, we convene at a time when unrelenting uncertainty casts a long shadow on the unique pathways that each of us sought to travel towards our common destination.'
Following developments in early April, when US President Donald Trump announced sweeping reciprocal tariffs against trading partners, global fragmentation has been exacerbated by a new kind of confrontation, he said, adding that geopolitical conflicts around the world have intensified and metastasised to neighbouring regions.
'All of us were prompted to reconfigure our behaviours in markets and accept a new norm rife with volatility.'
Tengku Muhammad Taufik said Asia's vast solar, wind and natural gas resources present an opportunity as the world reels from supply shocks and energy volatility.
'Parts of Asia enjoy abundant solar irradiance. Here, we see long coastlines and annual monsoon winds, which present vast and untapped renewables potential. Asia is blessed with abundant viable geological formations for carbon capture and storage – combined with an opportunity to deploy cleaner natural gas, this all points to a growth destination.'
He remarked that Asia will play a central role for the world's energy transition to be possible because in 2050 the population in Asia-Pacific is expected to rise to 5.2 billion.
'To power our economies, to fuel AI adoption across all industries, to keep the lights on for our population and to safeguard our communities, this region will represent 50% of global energy demand until 2050.'
Therefore, Tengku Muhammad Taufik said, the stage must be set for Asia to build upon its achievements and accelerate the progress from where it stands today, as the centre of energy demand growth where opportunities are abundant.
'To address Asia's growth ambitions even as it aims to achieve net zero, US$88.7 trillion (RM376 trillion) in energy investment will be needed until 2050.'
Investment and spending across both conventional and renewable energy systems continues to be required, he said.
'Today we are contending with increasingly erratic market forces, surging operating costs, rising temperatures and recurring natural disasters – all demanding us to act with immediacy and adapt with agility.'
Energy Asia – hosted by Petronas and knowledge partner CERAWeek by S&P Global – gathers 38 industries from more than 60 countries under the theme 'Delivering Asia's Energy Transition' at the Kuala Lumpur Convention Centre.
Officiated by Prime Minister Datuk Seri Anwar Ibrahim, Energy Asia is set against the backdrop of rising urgency and solidarity, bringing together policymakers, industry leaders and energy professionals to align strategies and pragmatic solutions that meet the unique challenges and opportunities of developing and emerging economies.
'At Energy Asia, we now enjoy and benefit from the participation of almost 3,000 delegates from not just the oil, gas and energy industry, but also from power and utilities, technology and logistics, clean tech and renewables as well as financial and professional service providers,' said Tengku Muhammad Taufik.
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