Hong Kong firms face profit squeeze as US importers cut orders amid oil crisis

US importers have cut orders and shifted to short-term contracts amid a global oil crisis triggered by the Middle East conflict, according to Hong Kong business leaders, who warn that profit margins are eroding and liquidity is becoming strained.Executive Council member and businessman Jeffrey Lam Kin-fung said on Sunday that the US-Israel war on Iran had driven up fuel costs, raising operating expenses for local firms.He urged the Hong Kong Government to bolster ties with Central Asian and ASEAN nations, framing the move as a vital strategy to diversify market risks.“Orders are greatly affected, shifting from long-term to short-term, but costs have risen with no room to pass them on through price increases,” Lam said.“The situation is unclear and will definitely impact the cash flow of Hong Kong’s small and medium-sized enterprises, so we cannot sit idly by.”Jeffrey Lam urges the Hong Kong Government to bolster ties with Central Asian and ASEAN nations, to diversify market risks. Photo: Nora TamThe Middle East conflict, now in its fourth week, has triggered a global oil crisis, with Iran sealing the Strait of Hormuz, a critical energy chokepoint.