OCBC Group Research published a three-scenario framework on 9 March: Brent below USD 70 if flows normalise by mid-2026; near USD 100 through mid-year in a moderately severe scenario; and a spike toward USD 140 in an acute disruption. For practical treasury planning, a USD 80–USD 100–USD 120 band captures the actionable range.

CPI Pass-Through

CPI pass-through is the fastest-moving variable. OCBC estimated that every USD 10 oil price increase reduces current account balances by approximately 0.5% of GDP in Thailand, 0.4% in the Philippines and 0.3% in Malaysia.

ING’s Deepali Bhargava, regional head of Asia-Pacific research, identified the Philippines as carrying the “fastest pass-through” in ASEAN – retail fuel prices rose 5% immediately in March 2026, with a further 12% increase announced within days, and no effective subsidy buffer to absorb either move.

Indonesia and Malaysia slow the pass-through via subsidy regimes but OCBC warned every USD 10 increase could raise Malaysia’s fiscal deficit by 0.1%–0.2% of GDP and potentially double Indonesia’s fuel subsidy bill at sustained USD 100 oil.

The CFOs best positioned to manage through this are those who have already stress-tested cost models at USD 120, locked in currency hedges at USD 100 assumptions and mapped rate policy probabilities by individual market.

Currency and Rate Policy

Currency and rate policy diverge sharply. Nomura raised its conviction on Bank Negara Malaysia hiking rates under current conditions, while flagging BSP as at risk of holding rather than cutting in April. OCBC noted rate hikes could become possible in an acute scenario for the Philippines and Indonesia.

UOB senior economist Julia Goh observed that the BSP’s interest rate differential with the US has compressed to a historic low of 50 basis points – a hold may be insufficient to arrest peso weakness, let alone a hike. Thailand’s Bank of Thailand has historically shown patience through supply-side shocks, with a hold remaining the base case even at USD 120.

Goldman Sachs estimated that a six-week Hormuz closure at USD 85 oil would raise regional Asian inflation by approximately 0.7 percentage points.

Operating Cost Impact

Operating cost impact escalates non-linearly. At USD 80, pressure concentrates on logistics and transport lines. At USD 100, the industrial channel opens: Rayong Olefins, a Siam Cement Group unit, suspended petrochemical operations in Thailand in March after losing access to naphtha and propane.

At USD 120, force majeure declarations – already on record from Singapore’s Aster Chemicals and Indonesia’s PT Chandra Asri Pacific – become a regional pattern rather than an isolated event.

Goldman Sachs estimated that a six-week Hormuz closure at USD 85 oil would raise regional Asian inflation by approximately 0.7 percentage points. That price level has already been exceeded, and the duration threshold is approaching.

The CFOs best positioned to manage through this are those who have already stress-tested cost models at USD 120, locked in currency hedges at USD 100 assumptions and mapped rate policy probabilities by individual market. For those still working from a single regional assumption, that window is closing.

INSIGHT BOX

PASS-THROUGH ASYMMETRY

The Philippines transmits oil shocks immediately – retail prices rose over 17% in one week in March 2026, with no effective subsidy buffer. Indonesia and Malaysia slow pass-through via subsidies but transfer the cost to fiscal deficits instead. For CFOs, the variable that matters is not the oil price. It is which channel carries the shock to your cost base first, and how quickly.

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