{"id":47958,"date":"2026-04-16T12:04:29","date_gmt":"2026-04-16T12:04:29","guid":{"rendered":"https:\/\/ipp-news.com\/?p=47958"},"modified":"2026-04-16T12:04:29","modified_gmt":"2026-04-16T12:04:29","slug":"us-iran-war-exposes-cost-of-asias-fossil-fuel-reliance","status":"publish","type":"post","link":"https:\/\/ipp-news.com\/?p=47958","title":{"rendered":"US-Iran war exposes cost of Asia’s fossil fuel reliance"},"content":{"rendered":"
As the second energy shock in four years roils global markets, the contrasting experiences of Pakistan and Bangladesh underscore the costs to emerging market countries from relying on fuel imports and the case for cleaner power sources.<\/p>\n

After South Asian countries were rocked by widespread electricity \u200boutages and inflation in 2022 due to soaring liquefied natural gas prices following Russia’s invasion of Ukraine, a consumer-led solar revolution swept \u200cPakistan, while Bangladesh signed long-term LNG deals to fuel its power plants.<\/p>\n

The fallout from the war with Iran that began with US and Israeli airstrikes on February 28 has highlighted the consequences of these divergent paths.<\/p>\n

Iran blocked the Strait of Hormuz in response, cutting off contracted long-term LNG supplies and prompting Bangladesh to buy 11 cargoes from the spot market for delivery from \u200bMarch to May.<\/p>\n

Also Read: US-sanctioned supertankers enter Gulf despite blockade<\/p>\n

Bangladesh paid an average of $21.35 per million British thermal units (mmBtu) for the cargoes, double the pre-war prices. That cost the country about $880 million, \u200bequal to nearly 15% of its average total monthly imports in the first eight months of the fiscal year \u2060ending in June.<\/p>\n

In contrast, Pakistan has not made any spot LNG purchases after reducing its dependence on imported fossil fuels to 25%, from 32% \u200bbefore the Ukraine war. While power outages because of gas shortages could occur outside daylight hours when solar power is not available, they are expected to \u200bbe minimal.<\/p>\n

“Bangladesh can draw lessons from Pakistan’s success to insulate itself from fuel price volatility,” said Shafiqul Alam, analyst at the US-based energy think-tank Institute for Energy Economics and Financial Analysis.<\/p>\n

Pakistan has become less dependent on imported fossil fuels<\/p>\n

With rising air-conditioning use set to push power demand higher, Bangladesh will buy three more LNG cargoes for delivery in May. Dhaka has already sought $2 billion in external financing for \u200bfuel imports and trimmed public spending.<\/p>\n

As its renewable capacity has largely remained stagnant since the Ukraine war, the country now gets 60% of its annual \u200bpower from imported gas, coal and expensive coal-fired power from neighbouring India, compared with 42% in 2021.<\/p>\n

Bangladesh’s reliance on imported fuel is increasing as its renewable additions have remained stagnant<\/p>\n

Moment of reckoning for import-dependent economies<\/p>\n

Bangladesh’s predicament is not unique. In Southeast Asia, fossil \u200cfuel \u2060subsidies to shield consumers from rising prices shot up to a record $105 billion in 2022, 60% above the previous peak, according to an International Energy Agency report on the region released in October 2024.<\/p>\n

Across Asia’s energy-import-dependent economies, inflation rose to decadal highs after the Ukraine war, with emerging economies Thailand and the Philippines hit especially hard.<\/p>\n

Surging prices inflicted deeper and more sustained pain in emerging economies.<\/p>\n

But unlike in Bangladesh, renewable additions across the world are surging. That resulted in global fossil-fuel-fired power output falling last month despite war-linked \u200bfuel supply disruptions and a rise \u200bin power demand, according to the \u2060Centre for Research on Energy and Clean Air (CREA).<\/p>\n

Also Read: Israel, Lebanon to speak after ’34 years’, says Trump<\/p>\n

A surge in wind and solar installations due to plunging costs is driving a decline in dependence on fossil fuel-fired power generation globally<\/p>\n

Pakistan’s solar boom helped it slash $12 billion in oil and gas imports during the four years to February 2026, according to CREA and the Pakistan-based consultancy Renewables First, with cheap \u200bsolar power now driving a shift from petrol to electric motorbikes.<\/p>\n

Three in four people globally live in net fossil-fuel-importing \u200bnations, and a faster shift \u2060to clean power would also cut exposure to price shocks. In fossil-fuel-hungry Southeast Asia, swapping planned gas capacity for solar would slash generation costs by 60%, analysts from energy researchers Ember said in a report last month.<\/p>\n

“To make such recurring global emergencies a thing of the past, it’s essential to use this moment \u2060to accelerate \u200bthe global energy transition,” said Lauri Myllyvirta, lead analyst at CREA.<\/p><\/div>\n","protected":false},"excerpt":{"rendered":"

As the second energy shock in four years roils global markets, the contrasting experiences of Pakistan and Bangladesh underscore the costs to emerging market countries from relying on fuel imports and the case for cleaner power sources. After South Asian countries were rocked by widespread electricity \u200boutages and inflation in 2022 due to soaring liquefied […]<\/p>\n","protected":false},"author":1,"featured_media":0,"comment_status":"closed","ping_status":"closed","sticky":false,"template":"","format":"standard","meta":{"footnotes":""},"categories":[6],"tags":[],"class_list":["post-47958","post","type-post","status-publish","format-standard","hentry","category-english-news"],"_links":{"self":[{"href":"https:\/\/ipp-news.com\/index.php?rest_route=\/wp\/v2\/posts\/47958","targetHints":{"allow":["GET"]}}],"collection":[{"href":"https:\/\/ipp-news.com\/index.php?rest_route=\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/ipp-news.com\/index.php?rest_route=\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/ipp-news.com\/index.php?rest_route=\/wp\/v2\/users\/1"}],"replies":[{"embeddable":true,"href":"https:\/\/ipp-news.com\/index.php?rest_route=%2Fwp%2Fv2%2Fcomments&post=47958"}],"version-history":[{"count":0,"href":"https:\/\/ipp-news.com\/index.php?rest_route=\/wp\/v2\/posts\/47958\/revisions"}],"wp:attachment":[{"href":"https:\/\/ipp-news.com\/index.php?rest_route=%2Fwp%2Fv2%2Fmedia&parent=47958"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/ipp-news.com\/index.php?rest_route=%2Fwp%2Fv2%2Fcategories&post=47958"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/ipp-news.com\/index.php?rest_route=%2Fwp%2Fv2%2Ftags&post=47958"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}