Iran war may speed Southeast Asia's nuclear energy planning drive

The war in Iran could push Southeast Asian governments to move faster on nuclear energy plans, as the region looks for ways to reduce its dependence on oil and gas from the Middle East, experts told The Straits Times.

The closure of the Strait of Hormuz, a key shipping lane that carries about 20 per cent of global oil trade, has highlighted how exposed the region is to imported fuels. Experts said the disruption has left economies vulnerable to price swings, pressure on energy systems and wider economic shocks.

For Southeast Asia, where energy supplies remain heavily tied to Middle Eastern oil and gas, the crisis has strengthened the argument for a broader energy mix and for nuclear power as a way to improve energy security.

Arkady Gevorkyan, commodity strategist at Citibank, said interruptions to oil and gas flows have lifted the cost of electricity generation and pushed up the price of baseload power, the minimum electricity a grid needs at any given time. That has made nuclear energy more attractive as a secure source of power, he said.

The conflict has also boosted interest in renewables. But experts noted that solar and wind power depend on weather conditions, which can lead to uneven output. Nuclear energy, by contrast, can operate continuously, requires less land, uses fewer natural resources to produce large volumes of power and does not emit greenhouse gases from nuclear reactions. It can also support energy-heavy sectors such as heavy industry and data centres.

Tan-Soo Jie-Sheng of the Lee Kuan Yew School of Public Policy at the National University of Singapore said interest in nuclear power had already been rising before the war, driven by surging electricity demand, decarbonisation needs, land constraints and the intermittent nature of renewables.

He said the conflict has “reinforced and accelerated” the reasoning behind nuclear energy, but added that any such strategy depends on long-term commitment. Countries that had left nuclear plans on the back burner may now reassess them more seriously.

“What the conflict has done is sharpen the energy security argument by highlighting how exposed the region remains to imported fossil fuels and geopolitical risks,” he said.

Gevorkyan pointed to Europe after the Russia-Ukraine conflict, when reliance on imported gas and periods of weak renewable output pushed the region to focus more strongly on energy independence and security. Europe has since expanded solar and wind power and diversified its fuel imports.

“Markets that rely on one source or two sources of energy for power generation are not immune to any sort of cataclysms or events when there is a power disruption,” Gevorkyan said.

An additional source of baseload power would help countries reduce reliance on foreign suppliers and cushion them from fuel price volatility, he said. Asia’s rising dependence on increasingly expensive gas imports could also make nuclear energy more competitive.

Momentum is already building across the region. An International Energy Agency spokesperson said Vietnam, Indonesia, Thailand and the Philippines have included nuclear power in their development plans and are moving forward with feasibility studies, preparatory work and international cooperation.

Vietnam signed an agreement with Russia on March 23 to build a nuclear power plant with two reactors and a combined capacity of 2,400 megawatts. The country aims to bring its first nuclear power plant online as early as 2030.

Malaysia said on March 27 that it was conducting a comprehensive assessment of a potential nuclear energy programme, after nuclear power was included in its 13th Malaysia Plan in July 2025. Deputy Prime Minister Fadillah Yusof said assessing nuclear energy had become increasingly relevant as the global energy landscape changes amid geopolitical uncertainty and fluctuations in fuel supply and prices, national news agency Bernama reported.

Singapore has commissioned studies on several aspects of nuclear deployment, including advanced nuclear technology, and has signed international partnerships to learn more about the latest scientific research and nuclear technologies.

Indonesia and Japan also agreed in March to cooperate on nuclear energy, including the possible construction of a nuclear power plant in Indonesia’s West Kalimantan province on Borneo.

“Taken together, the region is not yet building nuclear plants, but it is clearly moving from initial interest toward institutionalisation, with policies, targets and international agreements beginning to take shape,” Tan-Soo said.

Victor Nian, founding co-chair of the independent think-tank Centre for Strategic Energy and Resources, described the conflict as a “wake-up call” for countries that rely heavily on fossil fuels, especially imports from the Middle East.

“In the short term, there is nothing much we can do but to ride out the storm,” he said.

“When looking long term, I’m sure nuclear energy and potentially even coal are among the top strategic options being seriously considered by ASEAN countries … Energy transition of the future might not be solely focused on decarbonization, but energy security and economic security.”

Some countries, including Thailand, Indonesia and Vietnam, have turned to coal as a fallback. Thailand is considering plans to restart the retired Mae Moh coal-fired power plant, while Indonesia has decided to increase coal output. Although coal is cheaper and more readily available during fuel shortages, it remains the most polluting fossil fuel.

Experts cautioned that nuclear power cannot offer a quick fix. Dinita Setyawati, senior energy analyst at energy think-tank Ember, said countries would need years, or even decades, of investment to train skilled workers, build strong regulatory and safety institutions, and select suitable sites based on geological, environmental and social criteria.

Yao Lixia, research fellow at the Energy Studies Institute of the National University of Singapore, said high initial costs, long construction periods, regulatory and institutional gaps, and public concerns mean nuclear power is still a long-term strategic option rather than an immediate answer.

“While the crisis has revived interest in nuclear as a secure, low-carbon baseload option, it is unlikely to lead to meaningful deployment in the short to medium term,” she said.

She added that regional governments are increasingly looking at nuclear power as a reliable energy source, but within existing long-term strategies rather than as a direct reaction to the Middle East crisis.

“The current crisis may reinforce the strategic rationale, but most initiatives remain at the level of policy planning and institutional preparation,” she said.

Tan-Soo said the more realistic reading is that the conflict has moved nuclear energy from the sidelines into a more central position in long-term energy planning.

“It strengthens the case for diversification, but does not shorten the timeline required to develop nuclear safely and responsibly,” he said.

The Straits Times