AGP Executive Report

India’s Power Crunch: Rising demand could push India’s planned coal additions to 105–150 GW, up from 97 GW, as weak hydropower output and surging consumption strain supply. Fuel Security: Attacks near the Strait of Hormuz left two Indian sailors missing and another tanker struck; Saudi Aramco is weighing alternative export routes as regional risks disrupt oil flows. Storage and Renewables: Four-hour batteries now undercut gas peaker costs in all 43 markets modelled, while China’s storage costs are more than 55% below the Asia-Pacific average. India, meanwhile, curtailed 4.2% of its solar power in July and August, highlighting grid constraints even as power shortages deepen. Regional Energy Links: Southeast Asia faces a major power-supply challenge, with weak grids complicating efforts to meet rising demand and connect clean-energy projects.

Oil Security: Attacks on Saudi facilities and two tankers near the Strait of Hormuz are keeping supply risks high as oil tops $100 a barrel. Pakistan is seeking Libyan crude to diversify imports, while Japan is urging stockpiling and more energy development. India’s Grid: India curtailed 4.2% of its solar output in July and August—about 1.8 billion units—as grid constraints blocked power even amid shortages. Coal stocks have since held above 18 million tonnes as supplies improve; NTPC is also seeking 3.3 GWh of battery storage. Clean Energy: Indonesia’s SEDAYUSolar and China’s GoodWe are joining forces to develop solar projects. China will cut its new-energy vehicle export rebate from 13% to 9% starting in April 2027.

Shipping Risks: Two tankers were attacked near the Strait of Hormuz, with two Indian sailors missing; Houthi strikes on Saudi airports and energy sites add to threats around key oil routes. India’s Power Shift: Peak demand is forecast to reach 459 GW by FY36, pushing renewable procurement toward firm supply and storage. Battery storage capacity could grow 91% to 302 GWh by FY32. Nuclear Plans: Philippine President Ferdinand Marcos renewed his call for nuclear power as the country studies potential plant sites; India is targeting 100 GW of nuclear capacity by 2047. Pacific Climate: El Niño pushed sea temperatures in a key Pacific zone to a September record, raising concerns about drought and flooding. China’s EV Transition: New energy vehicles reached a record 61.6% of China’s new-car sales in September, even as total vehicle sales fell year on year.

Ukraine Energy Truce: Trump says Russia and Ukraine agreed to halt attacks on energy infrastructure, but terms remain unclear; Kyiv says it is waiting for details and wants Moscow to comply. Oil Supply Risks: Houthi forces claim fresh strikes on Saudi energy sites as attacks on Gulf shipping disrupt oil flows and keep prices above $100 a barrel, raising costs across the region. Pacific governments are cushioning the fuel shock with welfare support and transport subsidies, while officials urge a faster shift to clean energy. India’s Industrial Push: A draft steel policy targets 604 million tonnes of capacity by 2047, but coking-coal demand could more than triple to 236 million tonnes a year. The plan also calls for lower emissions through measures including hydrogen-based steelmaking. Power and Investment: India’s NTPC is inviting industrial firms to co-invest in projects combining steam, electricity, renewables and storage. Japan’s Marubeni is exploring Bangladesh investments, including improving gas efficiency at a fertiliser plant. Critical Minerals: Chinese companies own 65% of Africa’s new lithium mining capacity, as the continent’s share of global supply more than doubled in two years.

Supply Risks: The Iran war is disrupting energy flows, while attacks and threats around Gulf shipping are raising insurance and freight costs. Brent is above $100 a barrel; all 22 Indian crew members aboard a tanker hit off the UAE were rescued. India’s Oil Exposure: The RBI opened a dollar facility for three state oil companies as costly crude and a falling rupee intensify pressure on the currency. AI Power Demand: Google’s $15bn, gigawatt-scale data centre in Visakhapatnam faces local opposition over land, water and electricity use. Google says it will use air cooling and won’t build where its power needs would divert supply from residents. Clean Energy and Grids: Fiji is urging Pacific nations to speed up the shift to renewables and cleaner transport. India and Singapore are exploring a 2GW power link through Southeast Asia, though feasibility and financing remain to be worked out. Suzlon also plans three AI-enabled wind-turbine blade factories in India, backed by ₹550 crore.

India’s Fuel and Currency Pressures: The RBI has opened a dedicated dollar window for three state-run oil companies as a sliding rupee raises the cost of energy imports. Coal’s Cost Advantage: Asian coal imports are poised to rebound as LNG remains far more expensive; in India, coal supplies to power plants rose 36% from September lows, easing stock pressures. Regional Grid Security: Southeast Asia’s growing power demand is testing weak grids and exposing reliance on imported fuels. A proposed 2,000 MW India-Singapore power link and ASEAN grid cooperation could strengthen regional supply, while renewables offer a longer-term path to energy security. China’s Energy Shift: China’s solar capacity has surpassed coal, marking a major change in its power mix.

Rupee and Oil: The RBI will supply dollars directly to three state-run oil companies from Oct. 12, aiming to ease pressure on the rupee as costly energy imports weigh on the currency. LPG Supply: The UAE regained its position as India’s top LPG supplier in September, providing 39% of imports; US shipments fell sharply. Clean-Energy Shift: China’s installed solar capacity has overtaken coal, while India’s growing renewable fleet raises the need for storage and better grid coordination. Regional Links: India and Singapore are exploring a 2 GW power corridor, as ASEAN energy ministers advance regional grid and supply-security cooperation. Energy Security: Asian countries are stepping up oil stockpiling and clean-energy links after Middle East disruptions exposed supply risks.

Regional Power Links: India and Singapore are exploring a 2,000 MW electricity link, potentially running 3,000 km through Southeast Asia. The proposal comes as Singapore’s wider import plan stalls: none of its approved projects has reached financing or construction. Energy Security: Japan-led AZEC members are working to strengthen regional oil stockpiles, with Saudi Arabia and the UAE offering support. The Philippines is also studying a fuel-storage hub as Hormuz disruption strains supply. Clean Power: The Philippines plans to auction 25 GW of renewable capacity over the next year and says it remains confident of reaching 35% renewables by 2030. India installed 6.05 GW of wind capacity in the latest year. Storage and Supply: Four-hour batteries now cost less than open-cycle gas turbines in 43 markets, while India’s coal deliveries to power plants rose 36% from September lows, easing stock depletion. Sri Lanka is meanwhile pitching four Mannar Basin oil and gas blocks to investors.

Oil and Fuel Security: China is set to resume October exports of about 3.7 million tonnes of gasoline, diesel and jet fuel, offering limited relief to tight Asian markets. Oil prices eased after President Trump ruled out strikes on Iran before the US midterms, but shipping risks and the conflict continue to unsettle supplies. Southeast Asia’s Energy Shift: The Iran-driven LNG shock is pushing the region toward solar and wind, but its 7 GW storage pipeline for 2030 is less than a third of the 23–26 GW needed to support renewable targets. India’s Wind Buildout: Annual installations are projected to reach 8 GW in FY2026–27 and rise to 13.2 GW by FY2030–31, backed by 43 GW of projects under construction and planned transmission investment. Cambodia’s Import Bill: Spending on diesel, gasoline and gas jumped 53.8% to $2.82 billion in the first nine months of 2026, as rising demand met higher global fuel prices.

Energy Security: Iran-war supply risks are pushing Asian governments to build oil reserves, accelerate renewables and advance a regional power grid. Japan is coordinating stockpiling plans with Asian partners, while the Philippines aims to establish a national reserve by the end of 2027. Clean Shipping: India and the EU have launched an industry coalition to develop cleaner maritime routes and promote low-emission fuels, targeting more resilient trade. Power Supply: Taiwan is preparing to restart a nuclear reactor as AI and semiconductor demand strains electricity supplies; generation could resume as early as 2028. Offshore Energy: Vietnam’s oil and gas projects are drawing Japanese, US and Russian companies as the country’s demand grows and Middle East tensions sharpen supply concerns.

Oil & Security: Renewed tanker attacks around the Strait of Hormuz have pushed crude above $100 a barrel, while China’s fuel-export halt threatens to tighten Asia’s diesel supply. Higher oil costs are also adding to inflation pressure in India, where the central bank has raised rates for the first time in nearly four years. Power Systems: India’s energy challenge is increasingly about delivery, not just generation: ageing, inefficient distribution transformers add to power losses and utility deficits. Renewables: Bangladesh has approved a 442 MW solar project on land once earmarked for coal, a major step for a country heavily reliant on imported fuel. Tata Power is also testing membrane-based floating solar at a Maharashtra reservoir. Pacific Transition: Malaysia says its emissions cuts must go hand in hand with affordable, secure energy and livelihoods; Pacific leaders are pressing for faster, fairer climate finance to help fund the shift to renewables.

Oil Supply Shock: Hormuz disruption and tanker attacks are reshaping trade and keeping fuel prices high. The IEA will speed up previously announced stock releases, with about 100 million barrels still to reach markets and diesel a priority. Asia’s Crude Shift: Indian imports of discounted Venezuelan oil are forecast to surge in October, while Chinese independent refiners are buying more Iraqi crude as Iranian supplies tighten. Fuel Security: Japan will help the Philippines strengthen its petroleum reserves, drawing on Japan’s experience to prepare for future supply shocks. Pacific Transition: Papua New Guinea’s prime minister urged Pacific leaders to turn climate pledges into action, including a faster shift to clean energy.

Philippines-Singapore Energy Diplomacy: President Ferdinand Marcos Jr will visit Singapore Oct 7-11, with investments, nuclear energy and tighter coordination on the ASEAN agenda for 2027. India Rates & Energy Inflation: India’s RBI raised the repo rate 25 bps to 5.50% as inflation runs above target and the rupee weakens, with oil-price and El Niño risks still in the mix. Power Supply Pressure in India: NTPC is reportedly seeking more private coal to plug reserves that have fallen sharply, as hydropower weakness and demand growth push a looming supply squeeze. Oil Market Shockwatch: Asian trading stayed cautious as Brent pushed above $101 amid Saudi-Houthi escalation and Hormuz-related supply worries, while Middle East exports show signs of recovery. China Refiners Re-route Crude: Chinese independent refiners increased purchases of Iraqi and Qatari oil to offset dwindling Iranian supplies. Aviation Fuel Cost Relief in India: India is considering reviving an ATF price stabilisation mechanism as West Asia tensions keep jet fuel costs high. Climate Action in the Pacific: Pacific nations pressed for stronger climate cuts ahead of COP31, warning the 1.5°C target is slipping fast. Renewables Push: India’s PM-KUSUM-backed solar project was commissioned in Uttar Pradesh, adding to decentralized clean power momentum. Antitrust in Japan: Japan’s watchdog raided major brewers over alleged beer price cartel coordination.

Strait of Hormuz Energy Security: India says 11–12 Indian crew were injured after a projectile hit the Panama-flagged tanker On Peace while transiting Hormuz; Oman also evacuated crew after a separate attack near the Gulf, underscoring how shipping risk is still spiking costs and disrupting flows. Oil Market Resilience: Industry leaders at an energy forum warned the US-Iran war has shifted oil from “just-in-time” to “just-in-case,” with Aramco and others pointing to redundant routes and tanker control as the new baseline. Iran Blockade Impact: A report claims Iran’s blockade has left dozens of Iranian tankers “parked” and with minimal revenue, while markets watch weekly US inventory data as Persian Gulf exports recover. India Growth & Energy Risks: The World Bank lifted India’s FY27 growth forecast to 7.1% but flagged global oil prices and El Niño as key volatility risks for households and capital flows. Southeast Asia Power Crunch: The IEA warns rising demand and fuel import dependence are leaving SEA more exposed to price swings and supply shocks, with grid and flexibility investment needed. Solar Supply Chain: Premier Energies began trial production at India’s largest TOPCon solar cell plant in Andhra Pradesh, signaling continued push to scale domestic clean manufacturing. Pacific Climate Finance: Pacific leaders at pre-COP31 in Fiji criticized slow, insufficient climate finance access as sea-level rise impacts Tuvalu. India Food Safety Spillover: Delhi High Court stayed India’s “energy drink” label ban for PepsiCo and Monster but barred fresh manufacturing—an example of how regulation can still ripple into consumer energy products.

Energy Security & Markets: China paused October fuel exports as domestic stocks fall, raising the risk of tighter diesel supplies across Asia. Oil & Shipping: Oil prices eased after Middle East exports improved and G7 emergency releases of diesel and crude helped calm supply fears, though Hormuz-linked tanker risks remain. ASEAN Power Crunch: The IEA warned Southeast Asia’s rising demand and import dependence are increasing exposure to disruptions and price swings, with electricity demand set to climb fast. Power for AI: South Korea transferred $2.4bn to Washington for a Texas gas-fired combined-cycle “Project Star” to power AI data centers, while details of Alaska LNG investment still need negotiation. Clean Energy Buildout: Japan’s Iwatani and Cosmo approved a hydrogen supply chain at Cosmo’s Chiba refinery, targeting operations from 2030. Solar Push in India: India’s rooftop solar drive gets renewed momentum as the PM Surya Ghar scheme scales household adoption. Policy & Growth Backdrop: The World Bank lifted India’s FY27 growth forecast to 7.1% but flagged risks from high oil prices and El Niño. Climate Diplomacy (Pacific): Pacific leaders at Tuvalu’s pre-COP talks urged an end to fossil fuel addiction and faster climate finance.

Middle East Energy Security: Strait of Hormuz remains a high-risk bottleneck, with reports of sailors offered up to $25,000 per trip as crude exports push back toward higher levels despite attacks and drone threats. Oil Market & Shipping Costs: Saudi Aramco cut Asia crude prices to a six-year low, but freight spikes are still squeezing Asian refiners—shipping a Gulf cargo to Asia can add about $30/bbl to delivered costs. India–US Trade: India’s finance minister said India-US trade talks have hit a plateau, warning further concessions may be “very, very difficult,” with tariff risk tied to Russian oil. RBI Watch: Markets are pricing a likely RBI rate hike as inflation broadens and growth stays resilient. ASEAN Energy Cooperation: The Philippines is pushing stronger regional energy preparedness at ASEAN energy meetings, citing Hormuz-linked supply and price pressures. Japan Energy Policy: Japan said it has no plans for new oil reserve releases after a G7 coordination deal. Clean Power & Grid Buildout: L&T won transmission orders across Saudi Arabia, UAE and India, while UltraTech commissioned more green capacity in Rajasthan and Karnataka. Renewables Finance: Banks are expanding green lending access for C&I renewable projects, including longer tenors and concessional terms for eligible borrowers. Pacific Climate Push: Pacific leaders and Australia-backed meetings in Fiji set the stage for COP31, with renewed calls for fair climate governance and funding.