Compared to where prices stood 12 months ago, however, the current price of oil is 50 percent higher. Choosing to see the glass as half-empty or half-full depends on whether one stands to gain or lose from lower prices.
Asia’s top 10 oil-importing countries accounted for 44 percent of global imports in 2015. (See Exhibit 1.) As a region, it is the world’s largest importer of oil. So it’s easy to see why the World Economic Forum’s recent annual Executive Opinion Survey finds “energy price shock” to be a key concern for business executives in the region.
A sustained period of lower oil prices would seem beneficial for the region. However, to understand the economic impact of this in a meaningful way requires deeper consideration.
The industry is positioned within a much broader economic ecosystem impacted by price shifts. Stakeholders in this ecosystem include governments, energy-intensive industries, the financial sector, and end users, areas worth exploring in more depth.
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ASIA’S OIL DEPENDENCE
A net oil trade map of Asia
Sources: APRC Analysis of BMI Research, BP Statistical Review,
and the World Factbook (Central Intelligence Agency)
Blair Chalmers is a director at Marsh and McLennan Companies’ Asia Pacific Risk Center.
Oliver Wyman is a division of Marsh and McLennan Companies.
This article first appeared in BRINK Asia.