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Governments' response to oil price surge and the escalating Middle East conflict

Governments across Asia are rolling out emergency measures as surging oil prices and market volatility threaten economic stability. Steps include fuel price caps, potential oil reserve releases and tariff cuts to secure energy supplies amid the escalating Iran war.

Reuters

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March 09, 2026

Governments' response to oil price surge and the escalating Middle East conflict

Smoke rises in Lebanon after an Israeli shelling, following an escalation between Hezbollah and Israel amid the U.S.-Israeli conflict with Iran, as seen from the Israeli side of the Israel-Lebanon border, March 8, 2026.

Amir Cohen/Reuters

Oil prices have soared while share markets have skidded on fears that the escalating U.S.-Israeli war on Iran will squeeze energy supplies and hamstring industries around the world.


Following are actions that governments are taking or plan to take to reduce the impact of the war on their economies.


SOUTH KOREA PLANS FUEL CAP


South Korean President Lee Jae Myung said on Monday that authorities would cap domestic fuel prices for the first time in nearly 30 years. The country will also look for sources of energy beyond supplies shipped via the Strait of Hormuz, and a 100 trillion won ($67 billion) market-stabilisation programme should be expanded if needed, he added.


JAPAN TELLS NATIONAL OIL RESERVE SITE TO PREP FOR RELEASE


The Japanese government instructed a national oil reserve storage site to prepare for a possible release of crude, Akira Nagatsuma, a member of the Centrist Reform Alliance opposition party, told Reuters on Sunday.

Details such as the timing of the release remain unclear, Nagatsuma said.


VIETNAM TO REMOVE FUEL IMPORT TARIFFS


Vietnam is planning to remove import tariffs on fuels to ensure supplies amid disruptions, the government said, adding that the measure is expected to last until the end of April.


BANGLADESH TO CLOSE ALL UNIVERSITIES


Bangladesh will close all universities from Monday, bringing forward the Eid al-Fitr holidays as part of emergency measures to conserve electricity and fuel.


-Compiled by Edwina Gibbs; Editing by Lincoln Feast/Reuters

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