<div id="readability-page-1"><img width="150" height="150" src="https://imageproxy.pbkrs.com/https://technode.global/wp-content/uploads/2026/03/Screenshot-2026-03-12-130827-150x150.png?x-oss-process=image/auto-orient,1/interlace,1/resize,w_1440,h_1440/quality,q_95/format,jpg" original-src="https://imageproxy.pbkrs.com/https://technode.global/wp-content/uploads/2026/03/Screenshot-2026-03-12-130827-150x150.png"/>Geopolitical tensions in the Middle East are reshaping the global energy landscape and accelerating the shift toward clean energy, according to OCBC Group Research. The disruption of oil and gas markets and supply chains caused by the conflict underscores the vulnerability of energy-dependent economies and highlights the urgency for diversification and investment in renewables. In a note released Wednesday, OCBC said the duration of hostilities and the extent of energy market disruptions will largely determine the pace and trajectory of the global clean energy transition. “If geopolitical tensions are prolonged alongside elevated oil and gas prices, countries will pivot to cost-competitive alternatives such as renewables and coal, or draw on existing stockpiles. The diversification of energy suppliers and sources remains critical to long-term energy security,” the research house said. The conflict has significantly affected the Strait of Hormuz, which handles roughly a quarter of global seaborne oil trade and one-fifth of liquefied natural gas (LNG) supply. Disruptions along this vital corridor amplify risks to Asia, which imports a large share of its oil from the Middle East. OCBC noted that persistently higher oil and gas prices create complex implications for the clean energy transition. Factors influencing national responses include the relative cost of alternatives such as renewables or coal, availability of fuel subsidies, domestic oil stockpiles, inflationary pressures, and commitment to climate goals. For many emerging markets, elevated fossil fuel prices could heighten stagflation risks. Yet, fuel subsidies in countries like Indonesia and Malaysia help buffer the immediate economic impact. Still, prolonged geopolitical tensions and volatile oil markets will likely force countries to seek alternative energy sources to reduce dependence on imports. In markets where clean energy sources are economically competitive, a pragmatic pivot toward renewables may accelerate. The European Union’s response to the Russia–Ukraine conflict offers a case study in rapid energy transition. Since 2022, the EU has significantly reduced dependence on Russian gas—from 150 billion cubic meters (bcm) in 2021 to 52 bcm in 2024—cutting the share of Russian gas imports from 45 percent to 19 percent. The bloc’s strategy emphasizes both immediate energy security and long-term decarbonization, underscoring the dual benefits of investing in clean energy: reducing exposure to volatile fossil fuel markets and supporting climate goals. Conversely, some countries may rely temporarily on conventional energy sources. China, for instance, with large coal and crude reserves, continues to use coal to manage energy security, despite rapidly expanding renewable capacity. Coal output rose to a record 4.83 billion tons in 2025, up 1.2 percent from the previous year. Similarly, Taiwan is considering ramping up coal-fired power production, while Italy may reactivate coal plants to address short-term supply gaps. While these measures ensure energy security, they could slow climate progress if prolonged. OCBC emphasizes that shocks to fossil fuel supply chains reinforce the importance of domestic energy production and supplier diversification. Indonesia, for example, plans to increase crude oil imports from the United States to reduce dependence on Middle Eastern suppliers. The research house noted that U.S. shale production could respond flexibly to supply gaps, although incremental output would take six to twelve months to reach global markets. OCBC also sees investing in renewable energy provides long-term economic and strategic benefits. Citing the International Energy Agency (IEA), the research house estimated that renewable energy deployment has saved fossil fuel-importing nations an estimated $1.3 trillion since 2010. By scaling renewables, countries have avoided importing 700 million tons of coal and 400 bcm of natural gas, demonstrating the tangible cost advantages of cleaner energy during periods of market stress. For Southeast Asia, the case is particularly compelling. Singapore, for example, relies on imported natural gas for approximately 95 percent of its power generation, sourcing 57 percent as LNG from global exporters—including the Middle East — and 43 percent as piped gas from Malaysia and Indonesia. While Singapore’s electricity consumers are cushioned from immediate price volatility due to fixed-price contracts and regulated tariffs, long-term energy security remains a priority, said OCBC. To address these vulnerabilities, it noted Singapore is advancing measures to diversify its energy mix and increase resilience. Strategies include importing low-carbon electricity from regional sources, expanding solar deployment, exploring deep geothermal potential, and developing capabilities for advanced nuclear energy technologies. These initiatives aim to reduce reliance on imported natural gas while enhancing access to reliable, clean energy. Other Southeast Asian economies are also adapting. Malaysia and Indonesia, both significant fossil fuel importers, are balancing short-term energy security with the need to invest in renewables. Fuel subsidies provide temporary relief from price spikes, but rising global energy costs reinforce the case for accelerating domestic clean energy projects. The broader regional perspective underscores the strategic importance of energy transition for Southeast Asia, OCBC said. Countries that invest early in renewables and diversify supply sources can reduce exposure to geopolitical shocks, mitigate inflationary pressures, and strengthen economic resilience. The transition also aligns with international climate commitments and net-zero targets, ensuring that long-term development is both sustainable and secure. “Accelerating clean energy strategies not only hedges against fossil fuel volatility and mitigates future shocks but also aligns with net-zero goals and accelerates the transition away from fossil fuels in the long term,” OCBC concluded. <blockquote>UOB Kay Hian expects Malaysia’s total solar PV capacity to exceed 6.5GW over 2026 to 2029</blockquote> </div>

OCBC Group Research highlights that geopolitical tensions in the Middle East are accelerating the global shift towards clean energy. The disruption of oil and gas markets emphasizes the need for energy diversification and investment in renewables. The duration of hostilities will influence the pace of this transition, with countries likely to pivot to cost-competitive alternatives. The report notes that while some nations may temporarily rely on conventional energy sources, investing in renewables offers long-term economic benefits and enhances energy security, particularly for energy-dependent economies in Southeast Asia.

OCBC sees geopolitical tensions to accelerate clean energy transition