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Joseph Sipalan

Malaysia and Australia pledged on Thursday to keep oil and gas flowing between them as the Iran war’s continuous squeeze on global fuel supplies compels regional countries to deepen energy trade cooperation.
Across Asia, governments have been scrambling for alternatives after crude oil and gas shipments from the Middle East were disrupted following Tehran’s move to choke access to the Strait of Hormuz in response to US-Israeli strikes against Iran that began on February 28.
The disruption has sent pump prices soaring and forced governments in the region to ration fuel for factories, power plants and farms while they look for new sources to bolster dwindling supplies.
Against that backdrop, Malaysia and Australia signed a joint statement on energy security, pledging to maintain a strong energy trade and potentially increase supply to each other after their domestic needs are met.
Australia provides nearly all of Malaysia’s liquid natural gas imports and is the Southeast Asian nation’s largest supplier of wheat, beef and lamb.
Malaysia, in turn, is an important source of refined fuel for Australia’s transport and industry, as well as urea – a widely used fertiliser – for its agricultural sector.

“We import gas from Australia, and they have assured us of this supply and that they will honour their commitments. And they have delivered,” Malaysia’s Prime Minister Anwar Ibrahim said at a joint news conference with his Australian counterpart Anthony Albanese in Putrajaya, Malaysia’s administrative capital.
“So we also have to ensure that our commitments … would be honoured.”
Albanese’s visit to Malaysia caps a whirlwind tour of Southeast Asia that included Singapore and Brunei.
He said Australia had already secured an additional 100 million litres of diesel across two shipments sourced from Brunei and South Korea, and was in talks with Malaysian energy giant Petronas on the way forward in “very challenging times”.
“Australia is very confident that we have, of course, fulfilled the contracts that we have made here with Malaysia, because we regard that security as being so important for our relationships in the region,” Albanese said.
The deal was significant in guaranteeing some energy security for both countries in the face of external pressures beyond their control, said Adib Zalkapli, managing director at geopolitical and public policy consultancy Viewfinder Global Affairs.
“For distant small countries like Malaysia and Australia, the Iran war is less about battlefield outcomes and more about safeguarding global norms, economic stability and long-term security in a rules-based order,” Adib said.


The agreement also highlights a “new normal” in how regional countries shore up their energy security, according to foreign policy expert Azmi Hassan.
The Iran war had exposed the fragility of the Middle East’s role in the global energy ecosystem, he said, forcing Asia’s economies to quickly adapt and strike new deals to mitigate the conflict’s impact.
“The war has demonstrated that a reliable source of energy is not reliable any more. With the current situation, we have no idea how long this is going to last,” Azmi said.
Any swift adaptation carries risks, however. Should either country turn to Russia for crude oil, it could invite US scrutiny over sanctions violations – a serious concern given Washington’s importance as a trade and investment partner for both nations, according to analysts.
“If both countries end up in a situation where they have to consider getting sanctioned crude oil to meet their energy needs, they will have to weigh which of the two consequences carries greater risk for their governments – an angry US president or outraged voters,” Adib said.


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Malaysia and Australia strike energy supply pledge to bypass Iran war disruptions

Australian Prime Minister Anthony Albanese and Malaysian Prime Minister Anwar Ibrahim meet at a press conference in Putrajaya on Thursday. Photo: AAP/dpa

Australia’s delegation, led by Prime Minister Anthony Albanese, and Malaysia’s delegation, led by Prime Minister Anwar Ibrahim, attend a bilateral meeting in Putrajaya on Thursday. Photo: AAP/dpa

Malaysia pumps up police action at border petrol stations to curb subsidised fuel leaks

A man fills his car with RON95 petrol at a station in Malaysia on March 25. Photo: EPA

Cars park at pumps at a petrol station in Malaysia. Photo: Ivy Ong 

Malaysia’s Maritime Enforcement Agency foils an attempt to illegally transfer about 700,000 litres of diesel off Penang waters on Sunday. Photo: Facebook / Agensi Penguatkuasaan Maritim Malaysia

Asia’s energy supply at breaking point as US blockades Hormuz

A liquefied natural gas tanker is seen at a port in Yokohama, Japan’s Kanagawa prefecture, on April 8. Photo: AFP

LNG facilities in Ras Laffan Industrial City pictured in February before the US-Israel-Iran war began. Qatar has said Iranian missile attacks have caused significant damage to the complex. Photo: EPA

A passenger boat sails past an Indian-flagged oil tanker docked near Mumbai on April 1. Photo: AFP

‘Malaysia won’t be lectured’: Singapore’s refusal to negotiate over Hormuz creates waves

Oil tankers anchor off Muscat, Oman, on March 7. Photo: Reuters

An oil tanker that Iran’s embassy in Kuala Lumpur says is the first Malaysian-linked vessel to pass through the Strait of Hormuz. Photo: X/iraninmalaysia

A man fills his car tank at a petrol station in Port Dickson, Negeri Sembilan, Malaysia, on March 25. Photo: EPA

Iran ‘does not forget its friends’ as Malaysia ships pass Hormuz amid selective access

A tanker shown in an image posted by Iran’s embassy in Kuala Lumpur, which said it was the first Malaysian-linked vessel to pass through the Strait of Hormuz. Photo: x / iraninmalaysia

Malaysia races to go green as Iran war squeezes oil supply

A solar farm in Malaysia is seen in this still from a social media video shared by Solarvest Group. Photo: Instagram/solarvestgroup

Solar panels are seen at the University of Technology Malaysia’s campus in Kuala Lumpur. Photo: Shutterstock

Engineers walk along a rooftop with solar panel arrays installed in this still from a video shared by Solarvest Group. Photo: Instagram/solarvestgroup

A solar farm in Selangor state. Malaysia’s government aims to raise renewables to 40 per cent of power generation within the next decade. Photo: Shutterstock 

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The deal creates a mutual spillover valve, allowing the partners to swap surplus energy once domestic demand is satisfied


The deal creates a mutual spillover valve, allowing the partners to swap surplus energy once domestic demand is satisfied.


Malaysia and Australia strike energy supply pledge to bypass Iran war disruptions

.css-1c6uqr6{color:inherit;font-weight:inherit;font-size:inherit;font-family:inherit;line-height:inherit;overflow-wrap:break-word;}The deal creates a mutual spillover valve, allowing the partners to swap surplus energy once domestic demand is satisfied

The deal creates a mutual spillover valve, allowing the partners to swap surplus energy once domestic demand is satisfied