Asia FX: Energy conflict risks pressure regional currencies – MUFG
By FXStreet Insights Team
Updated: 30 Mar 2026
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MUFG’s Senior Currency Analyst Lloyd Chan highlights that prolonged US–Iran tensions and potential damage to Middle Eastern energy infrastructure are increasingly weighing on Asian currencies.
MUFG’s Senior Currency Analyst Lloyd Chan highlights that prolonged US–Iran tensions and potential damage to Middle Eastern energy infrastructure are increasingly weighing on Asian currencies. High‑beta, oil‑importing FX such as INR, PHP, KRW and THB are seen as most vulnerable, with CNY, SGD and MYR also coming under pressure as energy risk premia persist and risk sentiment weakens.
High beta Asian FX face energy shock
"High-beta and oil-sensitive Asian currencies are likely to remain the first line of pressure whenever energy related headlines deteriorate."
"Currencies such as the INR, PHP, KRW, and THB are particularly exposed given their reliance on imported energy and sensitivity to higher oil prices through both inflation and current account channels."
"As oil volatility rises, these FX are more prone to underperform, especially during periods of broader risk aversion."
"The risk of prolonged Middle East conflict is also starting to weigh more on CNY, SGD, and MYR."
(This article was created with the help of an Artificial Intelligence tool and reviewed by an editor.)
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