Asia-Pacific Renewables Top Global Energy Growth Despite Hormuz Supply Shock
Ember data show APAC drove 3% electricity demand growth in 2025 with low-carbon sources meeting all of the increase, even as the Iran war lays bare the region's deep fossil-fuel import dependency.
Renewables added 3.3 exajoules of new energy supply globally in 2025, outpacing oil's 2.5 EJ gain and gas's 2.4 EJ rise, as Asia-Pacific led a 3.0% rise in electricity demand that ran well ahead of overall energy demand growth of 1.7%, an Ember report published Wednesday (2026-07-01) showed. Solar accounted for 71% of the renewable gain after expanding 30% during the year. For the first time, low-carbon sources met all of the increase in global electricity demand.5
For Asia's energy planners, the figures land against a backdrop of acute supply disruption. In 2025, the region absorbed 87% of the crude and 86% of the LNG transiting the Strait of Hormuz, according to The Economist, and the Gulf supplies between 40% and 80% of the seaborne crude imports of China, India, Japan and South Korea. The Iran war has all but severed that flow.3
The initial response was coal. Asian countries burned more of it as an emergency substitute when LNG prices surged sharply, boosting near-term emissions even as the longer-term trajectory for renewables improved. "The shift will impose substantial environmental and public health costs," said Dinita Setyawati, senior energy analyst at Ember. Analysts broadly expect the disruption to ultimately accelerate the region's transition to domestic renewable generation rather than delay it.1
The Ember data reinforce that structural reading. Despite the rapid growth of low-carbon electricity, fossil fuels still accounted for 86% of global total energy supply in 2025. Oil consumption rose 1.3% to 103 million barrels per day, gas demand climbed 1.6% and coal edged up 0.7%. The renewable build-out has not yet materially altered the commodity flows that run through the Hormuz strait.5
The chokepoint's reach extends well beyond crude. LPG exports from the Persian Gulf supplied 92% of India's and 26% of Southeast Asia's imports in 2025, according to Vortexa data. With Middle Eastern exports constrained, the United States has been redirecting higher LPG, propane and butane volumes toward Asia, but soaring freight costs have already prompted some buyers to cancel cargoes.4
Beyond energy, the blockade has cascaded through commodity markets that underpin Asian manufacturing. The region sources 22% of the world's traded urea, 24% of its aluminium, a third of its helium and 45% of its sulphur from countries behind the chokepoint, The Economist reported. Processing margins have collapsed, and refineries and chemical plants across China, India, Japan and Thailand have cut output by 5% to 15%.2
China is partially insulated on the crude side. Its 1.3 billion barrels of strategic reserve would cover roughly a year of lost Gulf imports. But Beijing has ordered major domestic refiners to suspend diesel and petrol exports, and Kpler estimates refineries there are already running at 10% or more below capacity.3
ICE Brent crude front-month traded at $71.81 on Friday (2026-07-03), up 0.55% on the session, with JKM Asian LNG front-month at $16.07. Early in the conflict Brent had risen roughly 40% from pre-war levels and European natural gas prices spiked 92%, suggesting that some rerouting has occurred even as Hormuz transit remains impaired.3
The degree to which this crisis accelerates renewable investment will determine how exposed Asian economies remain to future Hormuz disruptions. India and Southeast Asia's near-total dependence on Gulf LPG means even partial diversification toward electric cooking and heating would reduce a material vulnerability — one the war has made impossible to ignore.4,1