Oil fears keep S-E Asia’s central banks on their toes as they mull over easing plans

[SINGAPORE] South-east Asia’s economies came into the new year strong as trade and investments brushed off tariff fears in 2025, but the renewed threat of inflation from an oil shock could prompt its economies to delay their easing cycles – or even begin tightening.

Oil prices have surged more than 30 per cent since the onset of the US-Iran-Israel conflict, breaking above US$100 per barrel on Monday (Mar 9) as the closure of the Strait of Hormuz threatened global oil supply.

Across the region, inflation had largely been benign coming into 2026, leaving South-east Asia’s economies with ample policy space to boost growth through further rate cuts.