AGP Executive Report

Strait of Hormuz Watch: Japan’s PM Sanae Takaichi urged “free and safe passage” for ships in phone talks with Iran, as oil and shipping risk premiums keep markets jittery. Regional Macro: AMRO cut ASEAN+3 inflation to 1.8% but warned West Asia disruption is still feeding higher energy, commodity and logistics costs, with petroleum supplies tightening. India Energy Security: India’s LPG sourcing is shifting fast—US now supplies 55% of imports in May as Gulf cargoes fall—while India also tightens silver import rules, adding prior approvals. Power & Renewables Buildout: Avaada secured $950m for firm and dispatchable renewables plus solar in Rajasthan and Gujarat; Invergy opened a 3 GWh BESS factory in Uttar Pradesh; Sungrow unveiled a smart BIPV module for smarter solar plants. Shipping Decarbonisation: COSCO’s retrofit work delivered the first methanol dual-fuel container retrofit under Seaspan’s program, cutting the vessel’s EEDI by ~55%. Policy & Trade: India-US negotiators started a three-day round to finalize an interim trade deal; India-Myanmar agreed to expand trade via the rupee-kyat settlement, including energy and mining. Market Mood: Oil slipped on mixed Iran talk signals while gold steadied, and energy-focused equity funds outperformed amid power, oil & gas and renewables earnings optimism.

Middle East shock to energy flows: Oil jumped again as Iran threatened to halt talks and potentially block the Strait of Hormuz, keeping Asia markets skittish and pushing insurers to reprice war-risk cover for shipping. FX and funding pressure: India’s rupee stayed vulnerable as oil volatility met foreign stock selling, with analysts warning USD/INR could slide toward 98–100 if tensions drag on. Shipping and insurance strain: India reported a surge in services to East of Hormuz and the Red Sea, while insurers said war-risk premiums have spiked sharply voyage-by-voyage. Clean power grid reality check: Southeast Asia’s renewables push is shifting from building generation to fixing grids and accelerating the ASEAN Power Grid to deliver clean electricity reliably amid rising demand from data centres. EVs and energy transition in the region: Chinese EVs are rapidly gaining share in Indonesia, while Ethiopia moved ahead with electric buses after banning gasoline/diesel vehicle imports. Solar hardware push: Sungrow unveiled a smart PV module aimed at “self-diagnosis” and autonomous plant functions, signaling tighter digital control in Asia’s solar buildout. Policy and geopolitics: India and Australia stressed freedom of navigation as West Asia disruptions threaten energy supply chains.

Middle East Oil Shock: Gold slid while crude jumped as US-Iran strikes and Hormuz uncertainty kept energy markets jumpy, with Asia stocks riding AI gains even as bullion weakened. Southeast Asia Fuel Relief: The Philippines cut diesel, gasoline and kerosene after weeks of hikes, but LPG rose—showing how the Iran-linked squeeze is easing unevenly. India Jet Fuel Watch: India kept domestic ATF prices unchanged in June, while international jet fuel was cut 27%, offering airlines some cost breathing room. India Energy Costs: OMCs face under-recoveries of Rs 650 per LPG cylinder and Rs 30 per litre on domestic ATF, with the government continuing compensation. Regional Power Diplomacy: Qatar’s energy minister met China’s National Energy Administration chief on cooperation. Central Asia Green Corridors: At Baku Energy Week, Azerbaijan, Uzbekistan and Kyrgyzstan pushed renewable and grid connectivity plans, including the Central Asia–Azerbaijan Green Energy Corridor, with feasibility work and financing support highlighted. Rooftop Solar Boom (Philippines): Ember says Chinese panels are driving a rooftop surge, making the Philippines a major export destination as households chase lower power bills. Energy Transition Tech: China’s auto parts makers are pivoting to robotics as margins tighten, reflecting the next phase of electrification into intelligence. Energy Security & Trade: India-US interim trade talks advanced, while India-Oman CEPA came into force—both tied to broader resilience amid West Asia risks.

Data-centre renewables in Australia: Google, European Energy Australia and AirTrunk are preparing the 25MW Mulwala Solar Farm in NSW, a sign AI growth is pushing tech firms to back new clean power directly. Pacific energy sovereignty: Fiji, Tuvalu and Vanuatu leaders trained on installing and maintaining solar systems as fuel costs rise and imported diesel/oil strains budgets. West Asia shock hits Asia travel: Southeast Asia tourism is bracing for higher jet fuel costs and flight disruptions tied to the Iran war, threatening summer demand. Japan energy bill support: Japan is drafting a supplementary budget (over ¥3.1tn) to cushion households and municipalities from higher electricity and gas prices. EV supply-chain geopolitics: China still dominates permanent magnet supply for EVs; the US is trying to secure rare-earth oxides outside China to reduce bottlenecks. India power and efficiency push: EESL is rolling out advanced energy and water efficiency tech for Andhra Pradesh MSMEs, aiming to cut operating costs and boost green jobs. China manufacturing steadies: A private PMI shows factory growth continuing in May, with easing price pressures but weaker export orders. Energy market driver: Oil prices are rising on renewed Israel-Lebanon escalation and Hormuz uncertainty, keeping inflation pressure in focus.

India Power Push: India is planning to lift generation capacity from 283 GW to nearly 300 GW next year as peak demand hit 270.8 GW (May 21), with nuclear targeted to reach 100 GW by 2047 and a power adequacy plan mapped to 2029-30. Nuclear & Innovation: Science minister Jitendra Singh says India has shifted from technology follower to global innovation leader, citing progress in frontier areas including nuclear and clean energy. Diesel Decarbonisation: India may mandate isobutanol-blended diesel later this year to cut emissions and boost energy security, with tests on engines already underway. Fuel Export Relief: India cut export duties on petrol, diesel and ATF from June 1, aiming to balance global price swings with domestic supply. US-India Trade Talks: Chief negotiators begin four-day talks in New Delhi (June 1-4) to finalise an interim trade pact and advance the broader bilateral trade agreement, including energy and economic security. Renewables in the Region: Cambodia is accelerating renewables to reduce costly fuel imports as West Asia conflict strains tourism and growth; Malaysia raises biodiesel blending from B10 to B15 from June 1. China Economy & Safety: China’s May factory activity softened while illegal mining in Yunnan killed five, underscoring ongoing enforcement and risk. LNG Demand Signals: Mitsui eyes LNG expansion as data centers drive new gas demand.

India–West Asia Energy Risk: India’s Finance Ministry warns the Strait of Hormuz disruption is the “single most consequential variable” for external and inflation outlook, with pass-through from higher oil and logistics costs to consumers a key worry. Monsoon Watch: India’s monsoon forecast slips to 90% of the long-period average (lowest in 11 years), raising food-price and rural-demand risks. Power Market Rules (India): CERC proposes DSM reforms from July 1, including a daily weighted-average reference price, new deviation treatment for wind/solar, and steps to integrate energy storage into settlements. Biofuel Push (India): Road Transport officials say an isobutanol-diesel blending mandate could start later this year, with flex-fuel engine studies underway for heavy-duty use. Solar Deal (India): NLC India Renewables forms a JV with NCRTC to develop 110 MW grid-connected solar PV in Uttar Pradesh under a 25-year PPA. EV Battery Recycling (China): China plans tighter rules to curb illegal disposal and low-quality recycling as retired EV batteries exceed 1 million tons annually by 2030. Regional Security (Philippines–Japan): Japan’s JMSDF ship JS Ikazuchi docks in Davao for exercises and talks, underscoring deepening maritime cooperation. AUKUS Undersea Drones: US, Australia and UK plan unmanned undersea vehicles under AUKUS, drawing renewed China criticism. LPG Supply Shift (Central Asia): Uzbekistan sharply boosts Russian LPG imports, reflecting pricing and Middle East shipping disruptions.

Energy Security & LNG: India’s MEA says it’s diversifying gas sources and welcomed support after the first Equinor LNG cargo for DFPCL under a long-term deal, as West Asia risks keep supply tight. Oil Market Shock: Oil slid on ceasefire hopes around Iran, while U.S. shale output faces limits as drilled-but-uncompleted wells hit record lows—keeping pressure on crude flows that matter for Asia. Shipping & Hormuz Watch: India says a crude tanker bound for Visakhapatnam has safely crossed Strait of Hormuz, and it’s urging no panic buying as refineries run at high capacity and LPG production hits record levels. Power & Industry Disruption: Japan’s ethylene plants cut to a record-low operating rate as naphtha supply from the Middle East is disrupted. Renewables & Manufacturing: Reliance operationalised its Jamnagar clean-energy giga complex (solar modules and BESS ramp-up), while China delivered a domestic-gear LNG carrier milestone and Chinese solar leaders claimed a 28.2% cell efficiency record. Policy & Trade: The EU warned it may take tougher action over rising Chinese imports, and India is weighing fiscal incentives to localise EV battery supply-chain components. Climate Risk: Super El Niño threats are raising alarms for India’s monsoon and broader Asia food and power stress. Regional Moves: Japan and the Philippines upgraded ties to a comprehensive strategic partnership, explicitly including energy resilience and decarbonisation.

Energy Security (India): India’s government has ordered state-run fuel retailers to build 30-day LPG reserves as West Asia supply risks persist, while the RBI flags West Asia conflict and El Niño as threats to growth and inflation. Heatwave Response (India): The National Green Tribunal took suo motu notice of India’s extreme heatwave, warning of impacts on health, agriculture, water and wildlife and pushing for region-specific adaptation plans. Oil Markets (Hormuz): Oil prices slid again on hopes of a US-Iran ceasefire extension and possible reopening of the Strait of Hormuz, even as shipping disruption remains a key risk for Asia-linked demand. Power & Renewables (Philippines-Japan): Japan is backing regional energy resilience via its Power Asia programme, with the Philippines seeking to shore up oil security amid Hormuz-linked concerns. Clean Energy Projects (India): Ohmium International and InSolare Energy plan a 4 MW green hydrogen project for NLC India in Neyveli, while Mahanagar Gas and Fourth Partner Energy signed an MoU to explore renewable generation and supply for commercial and industrial users. Grid/Storage Finance (China): Singapore-based Concord New Energy agreed a sale-and-leaseback refinancing for its China energy-storage assets. Trade Diplomacy (India-Russia/QUAD): Putin said India-EAEU trade liberalisation talks have intensified; India also reiterated QUAD is not aimed at any country. Climate & Investment (Global): UNCTAD says the renewable transition needs over $1T a year by 2030, and the IEA links Middle East conflict to a shift toward domestic energy options.

Philippines–Japan Energy & Security Upgrade: President Ferdinand Marcos met Japan’s Fumio Kishida and later announced talks with PM Sanae Takaichi on GSOMIA, maritime border delimitation, and Abukuma-class destroyer transfer, while also elevating ties to a “Comprehensive Strategic Partnership” with energy resilience and renewables on the agenda. Middle East Shock to Asia’s Energy Flows: A heatwave plus Iran war-linked disruption is tightening coal and gas markets; in India, power demand is spiking and an oil tanker cleared the Strait of Hormuz en route to Vishakhapatnam. Shipping Rules Under Strain: Japan’s crude and naphtha imports have plunged as Hormuz disruption bites, with naphtha down 47% in April, raising plastics and chemical supply worries. Markets Watch: World stocks hit records as traders weigh a possible US-Iran ceasefire extension; oil slid on hopes of Strait reopening, but US sanctions on Iran’s military oil trade added risk. Japan Macro Signal: Tokyo inflation cooled, complicating Bank of Japan rate-hike timing. China Policy Push: PBOC reportedly urged state banks to boost lending as credit growth weakens. Clean Power Build-Outs: Guam’s new 198 MW Ukudu plant cuts fuel oil use and targets LNG-ready power; India’s NLC India outlined a shift toward renewables and BESS.

Middle East Energy Shock: Oil jumped after renewed US-Iran strikes, with markets again pricing higher risk to Strait of Hormuz flows and global inflation pressure. Power Sector Planning: South Africa may extend coal generation as gas replacement projects lag, highlighting how delivery delays can reshape energy transition timelines. Nuclear Deal in Central Asia: Russia agreed to build Kazakhstan’s first nuclear power plant in a $16.5bn Balkhash project, deepening energy ties and uranium-linked supply leverage. Asia Clean Energy Buildout: Indonesia is backing its first wind energy conversion project in Batam to strengthen offshore wind component fabrication. Battery Rules: China moved to tighten legal oversight of NEV battery recycling as retired volumes are set to exceed 1m tonnes by 2030. Energy Investment Outlook: The IEA’s World Energy Investment report flags a shift toward grids, storage, renewables, nuclear and efficiency, while gas-fired power orders and data-centre demand keep fossil investment relevant. Regional Trade & Energy Security: India and South Korea resumed CEPA upgrade talks, while Philippines-Japan elevated defense cooperation with added focus on energy security. Gas Infrastructure Contracting: Australia’s Worley won a framework deal to support APA’s gas transmission and storage expansion.

Philippines–Japan Energy & Minerals Push: President Ferdinand Marcos Jr. told Japan’s parliamentarians the Philippines is moving to a “highest tier” comprehensive strategic partnership as energy supply disruptions and geopolitics bite, with talks expected to include a study on reviewing the Japan–Philippines economic partnership agreement for critical minerals and energy resilience. Quad Energy Security: Australia, India, Japan and the US agreed to build a port in Fiji and signed pacts on critical minerals and Indo-Pacific energy security, aiming to strengthen supply chains amid Middle East shocks. Hormuz Shock Drives Markets: Fresh US strikes on Iran rattled Asia; oil bounced about 2% while investors weighed the risk of Strait of Hormuz disruption and looming US inflation data. Pacific Climate Finance Backlash: Tuvalu’s climate trust fund reportedly invested in coal, gas and a major refinery, prompting calls to review “fossil fuel exposure.” Data Centres vs Clean Power: Greenpeace warned Australia’s data-centre boom could push states toward more gas generation unless renewables and storage additions are enforced. China NEV Safety: China launched 2026 NEV safety hazard inspections, requiring manufacturers to submit risk reviews by Aug 31. Singapore Grid Integration: Singapore’s regulator said Chinese firms could benefit as ASEAN grid integration plans expand, including cross-border green power imports.

Strait of Hormuz Watch: Oil slid as investors weighed fragile US-Iran talks and reports of potential Hormuz shipping restoration, while markets stayed jumpy on renewed strike risk. India FX & Energy Costs: The rupee held near 95.7 per dollar as traders tracked crude moves; Moody’s warned prolonged West Asia disruption could raise credit stress for Indian banks via higher fuel costs. West Asia Risk to Services: LIC’s chief said a longer Middle East crisis could ripple into insurance through weaker incomes and savings. Coal & Power Supply: China formed a probe team into a Shanxi coal mine blast, while India’s Coal India advanced an oversubscription offer-for-sale amid strong demand. Clean Power Finance: CleanMax secured about $575m to build ~1 GW renewables in Rajasthan and Karnataka for corporate buyers. Renewables Transition Funding: UNCTAD said the energy transition needs $1tn+ a year by 2030, with developing economies relying heavily on foreign investment. Hydrogen Mobility: Indian Railways approved a hydrogen fuel-cell trainset pilot on the Jind-Sonipat route. Maritime Batteries: Corvus Energy and BYD Energy Storage expanded a partnership for next-gen zero-emission marine batteries. Philippines-Japan Energy Security Angle: Marcos’ Tokyo visit highlighted Japan’s development support and defense cooperation tied to protecting energy flows. Cebu Waste-to-Energy: Cebu province plans two Japanese waste-to-energy “Green Transformation Parks,” but says funding is the main bottleneck.

Quad Energy Push: Quad foreign ministers in New Delhi unveiled a new Indo-Pacific Energy Security initiative plus a $20bn critical-minerals framework, alongside maritime surveillance and a Fiji port plan—aimed at hardening supply chains and keeping chokepoints covered as Hormuz risk lingers. Hormuz Flow Watch: LNG shipments are inching back: Adnoc’s Umm Al Ashtan has exited Hormuz bound for India, while markets keep swinging on US-Iran ceasefire headlines. BOJ Warning: Bank of Japan Governor Kazuo Ueda said oil shocks can turn persistent if they feed wages and expectations, keeping rate-hike nerves alive. India Moves to Reduce Fuel Risk: India approved its first hydrogen-powered DEMU for the Jind–Sonipat route, while hydrogen and nuclear capacity stories underline a broader “energy sovereignty” push. Japan Grid Storage: Hyosung won another Japan ESS contract (10MW/40MWh), signaling continued demand for grid flexibility. Regional Governance: Philippines authorities arrested 24 Chinese nationals in Davao over alleged unauthorized work, highlighting ongoing immigration enforcement tied to labor supply.

Quad Energy & Maritime Push: Quad foreign ministers in New Delhi agreed to launch an Indo-Pacific maritime surveillance cooperation plan, expand maritime domain awareness, upgrade Pacific port infrastructure, and roll out an energy security framework—prompting Beijing to warn against “exclusive cliques” and bloc confrontation. Middle East Shock on Supply: With Strait of Hormuz tensions still driving volatility, Japan received a crude tanker (Idemitsu Maru) after a Hormuz crossing, while India continues shifting crude sourcing toward Africa and Latin America. India Grid Stress vs Buffer: India’s heatwave demand tests the system, but Coal India says it has a large coal buffer; Moody’s also flags near-term credit pressure from elevated energy costs. Renewables & Storage Momentum: Sri Lanka’s first commercial-scale BESS has arrived at Colombo Port, while China set a record for solar exports in March. Regional Deals: Uzbekistan and China signed green-energy science cooperation in Xi’an; India and the U.S. signed a critical minerals and rare earth supply agreement.

Quad Momentum: Foreign ministers from Australia, India, Japan and the US meet in New Delhi to revive the Quad’s “concrete actions” agenda, with maritime security and critical minerals back on the table. Energy Shock Watch: Oil is bouncing after a sharp drop below $100, but the Strait of Hormuz remains effectively constrained as US strikes in southern Iran add risk to any interim deal—LNG and crude are still rerouting toward Pakistan and China. Japan–India Energy Security: Jaishankar and Japan’s Motegi agree to coordinate on safe navigation through Hormuz and stable energy/critical-material supply chains. Corporate Moves: TDK is buying Malaysia’s Linergy Power for $241m to scale AI-focused battery capacity, while Singapore’s Pacific Channel acquires ENGIE Factory APAC to expand climate-tech early-stage investing. Regional Climate: Pacific leaders push climate justice and sea-level rise action as energy insecurity tightens across island economies. Markets & Policy: India eyes relief on cotton duties and warns West Asia disruptions could squeeze corporate margins, while Japan prepares a supplementary budget to cushion fuel costs.

Hormuz Hope Hits Markets: US-Iran “deal” chatter pushed crude down hard (WTI near $91, Brent under $98) and lifted global stocks to record highs, while gold and silver jumped as the dollar weakened. India Fuel Pain Persists: Despite four fuel hikes, India’s state oil firms are still losing about ₹600 crore a day; Finance Minister Sitharaman doubled down on the “3 Fs” (fuel, fertilizer, forex) as West Asia risk keeps costs elevated. Shipping Moves Again: A VLCC carrying ~2m barrels of Iraqi oil cleared the Gulf into the Arabian Sea, and an LNG tanker finally exited Hormuz toward Pakistan after weeks of disruption. Energy Transition, Saudi-Style: China’s ZOE Energy will build Saudi Arabia’s first BESS manufacturing plant (18 GWh capacity), aiming to localize storage for Gulf/MENA demand. Regional Deals & Security: Philippines President Marcos’ Japan visit (May 26–29) targets defense, maritime cooperation and energy resilience; Serbia and China signed 23 agreements in Beijing. Corporate Signals: Suzlon’s FY26 profit slipped 6% but deliveries hit record levels, while India’s data centers are forecast to near $46B by 2033 on AI-driven buildouts.