Asian fuel prices more than double amid West Asian energy crisis

Fuel prices across Asian countries have more than doubled compared to pre-war levels, driven by the ongoing energy crisis in West Asia, according to a report by the US financial institution BlackRock. Disruptions in crude oil supply have extended to refining and shipping systems, leading to a significant surge in fuel costs.Initially, alternative shipping routes, existing inventories, and strategic reserves helped mitigate the impact of crude oil supply disruptions. However, recent attacks targeting energy infrastructure and maritime shipping lanes in the Gulf region have intensified pressure on the supply chain. BlackRock’s report indicates that the impact of the scarcity is now more pronounced in refined fuels and the shipping sector than in crude oil itself.Despite some improvements in crude oil supply, bottlenecks in refining capacity and tanker availability continue to drive up fuel prices. Brent crude oil prices reached as high as $117 per barrel on October 23, the highest since April. As of today, Monday, November 2, 2026, the price has slightly decreased to $110.16 per barrel.The energy crisis has also affected the stock performance of oil refining and shipping companies. This year, shares of refining companies have surged by approximately 160 percent, while those of oil tanker operators have risen by 120 percent. In contrast, shares of major oil and gas producers have increased by only 40 percent.Europe is particularly vulnerable to the energy crisis, with its gross domestic product (GDP) estimated to have declined by about 0.5 percent due to the crisis. The US has seen a more limited impact, with its GDP affected by only 0.1 percent. Natural gas storage capacity in Europe is only about 75 percent full, the lowest level for this seasonal period since data collection began in 2011. European energy prices have already risen by 170 percent this year. The report warns that if the upcoming winter is colder, energy prices could increase further due to disruptions in liquefied natural gas (LNG) supply.The US, being a net energy exporter, is relatively more secure. Additionally, strong exports of technology goods have somewhat cushioned Asia from the rising cost of energy imports, BlackRock’s analysis shows. BlackRock anticipates that even if the conflict in the Middle East ends, the trend of investing in alternative supply routes and infrastructure for energy security will continue long-term.In Nepal, Nepal Oil Corporation, the state-owned monopoly oil company, increased petrol prices by Rs 17 per liter and diesel prices by Rs 25 per liter on April 10, 2026. On April 3, 2026, petrol prices in Kathmandu Valley reached Rs 202 per liter and diesel prices Rs 182 per liter. On April 30, 2026, Nepal Oil Corporation reduced petrol prices by Rs 2 per liter and diesel and kerosene prices by Rs 12 per liter, bringing petrol to Rs 217 per liter and diesel and kerosene to Rs 225 per liter.Nepal Rastra Bank, the central bank, reported an annual consumer price inflation of 6.34 percent as of October 15, 2026. The central bank anticipates inflation to hover around 4.0 percent by the end of 2026, below its annual projection of 5 percent. Economic growth is expected to be around 4.0 percent, falling short of the annual target of 6.0 percent. The external sector is projected to remain stable, with both the current account and balance of payments in surplus.The World Bank’s October 6, 2026, report indicated that Nepal’s real GDP growth rate for the fiscal year 2025/26 has fallen to 3.9 percent. The August 2026 floods are expected to negatively impact Nepal’s economic prospects in the short term, leading to a projected real GDP growth rate of 3.7 percent in fiscal year 2026/27. Significant damage to hydropower, solar energy, electricity transmission, and transport infrastructure is expected to hinder growth in the industrial sector, limiting power generation, manufacturing, and the movement of goods.