As conflicts in the Middle East continue to escalate, transport conditions through the Strait of Hormuz, a key channel for energy trade, have been severely disrupted. Concerns over potential exhaustion of global oil reserves are resurfacing. However, according to Goldman Sachs' latest analysis, while the supply chain is under immense pressure, the situation is more complex than a simple global shortage. The main challenge facing the market currently lies in the risk of regional supply interruptions rather than overall resource depletion.
In terms of regional distribution, Asian economies are facing the most direct impact. Data shows that refined product imports in many countries across the region rely heavily on oil-producing areas in the Persian Gulf. About half of the fuel supply for many Asian economies comes from this region. For some countries with extremely high dependence on energy imports, such as South Korea and Singapore, this proportion is even close to three-quarters. Such high structural dependency means that once transportation in the Persian Gulf slows down, fuel security within the region will face severe tests.
Currently, various countries have adopted a series of buffer mechanisms to cope with potential risks, including seeking alternative suppliers, drawing on existing strategic stockpiles, and restricting exports to stabilize domestic markets. However, Goldman Sachs warns that these measures may only maintain short-term balance. By late March, net oil imports to the Asian region had already seen a significant decline, indicating that supply pressure is gradually accumulating as transportation from the Persian Gulf is blocked. Not all types of fuel are affected to the same degree; naphtha and liquefied petroleum gas (LPG) have lower inventory levels and complex storage requirements, leading to the tightest supply. Prices for diesel and jet fuel have surged due to supply constraints combined with precautionary hoarding behavior.
On-the-ground situations further confirm the existence of market pressure. Multiple countries, including India and Thailand, have reported fuel rationing or supply interruptions, and local governments have begun taking measures to manage domestic consumption. Despite this, the bank does not classify this as a long-term structural supply crisis yet. Large economies with substantial strategic reserves, such as China and Japan, possess stronger shock resistance capabilities. The overall market can still maintain certain flexibility by readjusting trade flows and consuming stocks. Essentially, global oil has not been exhausted. However, if the disruption in the Strait of Hormuz prolongs, local shortages and sharp price volatility could further intensify in areas with the highest import dependence.
