APAC Brief: Australia Halves Fuel Excise as South Korea Turns to Russian Naphtha

One month into the Hormuz closure, APAC is in full crisis mode. Australia just halved its fuel excise. South Korea broke years of policy to buy Russian naphtha. India has 18 ships stranded with cooking gas. And Brent crude just posted the largest monthly surge ever recorded — 51% in a single month.

Commodity snapshot (as of March 31)

Brent crude: $105.13/barrel (down from $115 intraday on ceasefire hopes)
WTI crude: $102.12/barrel (settled above $100 for first time since 2022)
Gold: down sharply — 5th-largest monthly fall in 50 years
Dubai physical crude: $126/barrel (reflecting Asian premium)
Brent monthly gain: +51% — largest on record, surpassing the 46% surge in September 1990

Australia halves fuel excise from April 1

Prime Minister Anthony Albanese announced on March 30 a halving of the fuel excise tax effective April 1 through June 30, saving drivers roughly 26 cents per litre. The government also released a new four-level National Fuel Security Plan and is preparing emergency legislation granting the finance minister authority to rush through fuel purchases worth up to AUD $2 billion without parliamentary approval. At least six fuel shipments to Australia have been cancelled, though the government says it has covered shortages. Petrol prices in Australia's five largest cities rose 8-10% in the week to March 25, with prices up roughly 33 cents per litre in two weeks. Australia imports about 80% of its refined fuel from overseas despite being a major coal and LNG exporter.

South Korea resumes Russian naphtha imports

South Korea broke years of sanctions policy to resume imports of Russian naphtha — the critical feedstock for plastics used in automobiles and semiconductors. LG Chem is among the first buyers. The government simultaneously enforced a naphtha export ban to protect domestic chip supply chains. Seoul is also seeking Russian crude oil through a US sanctions waiver that expires April 11. The move reflects the desperation of an economy where over 95% of Middle East crude imports transited the now-closed Strait of Hormuz.

India: 18 ships stranded, LPG crisis deepens

Eighteen Indian-flagged ships carrying LPG and crude oil remain stranded near the Strait of Hormuz, with 485 Indian seafarers on board. India imports roughly 60% of its LPG, and about 90% of those shipments pass through the strait. Reports of panic buying and cooking gas thefts are spreading. PM Modi held direct interactions with Chief Ministers to review preparedness. India is diversifying to African and Argentine LPG sources, pushing piped natural gas, and capping airline jet fuel pricing as costs threaten to double by April. Indian airlines are negotiating a new pricing formula to cap crack spreads between $10-22 per barrel.

Asian currencies in worst rout since 1997

The Indian rupee, Indonesian rupiah, and Philippine peso all hit record lows against the dollar. The Japanese yen and South Korean won are at major troughs. Analysts are drawing comparisons to the 1997 Asian financial crisis. Indonesia opened a repo market for short-term dollars to defend the rupiah. India has capped banks' currency positions. Central banks face an impossible choice: raise rates to defend currencies (risking recession) or let them slide (importing more inflation).

Southeast Asia: states of emergency and school closures

The Philippines declared a state of emergency as the peso hit record lows and transport workers protested oil price rises near the presidential palace. Thailand slashed fuel subsidies, with gas stations posting "Diesel fuel has run out" signs. Laos — cut off after Thailand reduced deliveries — instituted a four-day school week and encouraged work from home, with hundreds of filling stations closed. Cambodia lost fuel supplies from Thailand and is seeking alternatives from Vietnam and Singapore. Shell's CEO warned last week that disruptions started in South Asia, moved to Southeast Asia, then Northeast Asia, and will spread to Europe in April.

LNG crisis: Asia braces for complete Middle East cutoff

Asian countries are bracing for a complete cutoff of Middle Eastern LNG in coming days. Repeated strikes on Qatar's LNG export complex have knocked roughly 28 million tons of supply from the market in 2026 — nearly the entire global supply growth forecast for the year. China, Japan, India, South Korea, Vietnam, and Thailand all rely significantly on LNG for power generation. Countries are burning more coal and cutting consumption as a stopgap. LNG shipments originally bound for Europe are being diverted to Asia where buyers pay higher prices, creating a bidding war between the two regions that neither can afford.

Markets surge on peace hopes

Asian and US markets rallied sharply on March 31. The Dow surged over 1,100 points — its best day in 10 months — after Trump said the US could end its military campaign in two to three weeks and announced a national address for Wednesday evening. However, major indexes still posted their worst quarterly performance in nearly four years. Oil prices retreated from highs but remain above $100. The rally is built entirely on hope — Iran has yet to agree to anything.

What to watch

Trump's national address Wednesday could signal a path to ending the war — or escalation. The April 11 expiry of the US sanctions waiver on Russian oil is critical for South Korea, Sri Lanka, and others. Pakistan says it will host US-Iran talks. But every day the strait stays closed, Asia burns through reserves it cannot easily replace. Indonesia's President Prabowo visited Tokyo to sign emergency energy pacts — the start of a new era of Asian fuel-bartering diplomacy.

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