Asia-Pacific Watches US Midterms as Iran War Energy Shock Lingers
Governments and businesses across the Asia-Pacific, still reeling from the energy shock caused by the United States and Israel's war on Iran, were watching the US midterm elections of November 3, 2026 closely. Analysts said many in the region want "enormous changes" in the rest of President Donald Trump's term, both on the Iran war and on trade and tariff policy.
The war began in January 2026 and was in its eighth month as of November 2. Iran closed the Strait of Hormuz, a sea passage for Gulf oil and gas, in response to US and Israeli strikes. Before the conflict, the Asia-Pacific received most of the Gulf oil and gas that moved through the strait.
The effects have varied across the region. The Philippines relies on the Gulf for more than 90 percent of its crude oil imports and has been under a national energy emergency since March 2026. The Institute of Southeast Asian Studies (ISEAS)-Yusof Ishak Institute, a research body in Singapore, reported that soaring fuel costs drained foreign exchange reserves, a country's stock of foreign currency, in Cambodia, Laos, Myanmar and East Timor. Indonesia, Malaysia, Thailand and Vietnam, the institute reported, spent heavily on fuel subsidies, government payments that hold down prices for consumers.
Tariffs, which are taxes on imported goods, have added to the pressure. In 2025, Trump imposed "reciprocal" tariffs of 10 to 50 percent on some 90 countries, aiming to shrink the US trade deficit, the gap between what the country imports and what it exports. Chinese goods exported to the United States face tariffs of 36.5 percent, while US goods entering China are taxed at 31 percent. In January, Trump announced that any nation doing business with Iran would face a 25 percent tariff on US trade.
In the midterm campaign, Democrats blamed tariffs for rising prices, while Republicans ran advertisements accusing Democrats who oppose tariffs of siding with China. Trump made his final midterm pitch at the Reflecting Pool.
Steven Okun, a trade specialist and chief executive of APAC Advisors, a Singapore-based consulting firm, said a Democratic-controlled Congress was unlikely to force Trump to end the Iran war, beyond investigations and oversight hearings. Trump has said US attacks on Iran were in self-defence, and he ignored congressional resolutions directing him to withdraw US forces from hostilities. Under the US Constitution, Congress holds the power to formally declare war. Overriding a presidential veto requires a two-thirds majority in both chambers.
On the diplomatic front, Iran and Qatari mediators held a third day of talks in Doha on November 1. A draft seven-step proposal to end the war, reported by Reuters, would call for the US to end its blockade on Iranian ports. Iran said contacts over ending the war continued after the Doha talks. Trump said the United States will not launch new attacks on Iran before the November vote. As of November 3, Vice President Vance saw "progress" in the talks.
