The Iran War Is Making the Case for Renewable Energy, Experts Argue

The war between the United States, Israel and Iran has triggered the largest disruption to global oil supplies in the history of the modern oil market, with Brent crude prices currently hovering around $100 a barrel, sending economic shockwaves across Persian Gulf states, Asian countries and the U.S. with no clear endgame in sight.

As the war nears the two-week mark, U.S. and Israeli forces have intensified their attacks on Iranian weapons sites and regional proxies, striking thousands of targets with increasing lethality. In retaliation, Iran continues to hit across the Middle East region, targeting U.S. military bases and oil and gas facilities, forcing the ramping down of oil production in many Gulf countries.  

The closure of the Strait of Hormuz, the narrow passage through which roughly a fifth of the world’s oil supply flows, has exposed the fragility of a global energy system still tied to fossil fuels. The ongoing disruption in the oil flows through the Strait of Hormuz is the largest supply shock in the history of the modern oil market according to one analysis from the consulting firm Rapidan Energy, affecting roughly 15 million barrels per day (bpd) in crude oil and 5 million bpd in oil production. 

On Wednesday, the International Energy Agency agreed to release an unprecedented 400 million barrels of oil from its emergency reserves in a bid to mitigate the effects of supply disruption on energy markets and the drop in cargo shipping to near zero through the Strait of Hormuz.

As Gulf producers declare force majeure and governments debate emergency reserve releases, energy analysts and clean energy advocates are warning that short-term fixes will not shield households from the price volatility that has accompanied every major Middle East conflict in the past.

Brent could stay between “$90-100 if it’s a few weeks of limited traffic through the Strait,” said Abhiram Rajendran, a non-resident fellow at Columbia University’s Center on Global Energy Policy. He added that the price fluctuation “would also be determined by how quickly the stock releases can be activated and be paced.”

While the stock releases could keep prices closer to $90, Rajendran cautioned that if there were further delays and the impacts in and around the strait were severe—including energy infrastructure being hit —then the oil price could likely exceed $100 for a period of time. “Should the conflict subside in a few weeks we would expect the price to normalize to around $70,” he said. 

A recent analysis by the center found that roughly “20 percent of global supply and 31 percent of seaborne oil trade have effectively halted, compared with 7 percent during the 1973 Arab oil embargo, 6 percent in the 1990 Gulf war, 4 percent during the 1979 Iranian Revolution, and 3 percent at the outset of the 2022 Russia-Ukraine war.”

Courtney Federico, associate director for international climate policy at the Center for American Progress, said the Iran war is yet another reminder that tying U.S. economic security to oil and gas leaves households at the mercy of distant conflicts and volatile global markets. 

“We saw [gas] prices hit above $5 a gallon in the wake of the Russian invasion of Ukraine … we saw Brent hit about $120 a barrel,” Federico said in a phone interview. She warned that “we’re seeing prices rise at an extremely alarming rate” again as Hormuz is threatened. Washington’s short‑term fixes, Federico said, from Strategic Petroleum Reserve releases to gas‑tax holidays and expanded drilling are “just a temporary fix” or “a very short term Band-Aid.”

Federico said that the real lesson from Ukraine, and now Iran, is that “being dependent on oil and gas, it just opens consumers to incredible volatility, and so I think, if anything, it reinforces the shift to renewable energy.” Clean energy, she argued, was the only durable way to “insulate ourselves against these price shocks” and the wider surge in food and living costs that “will kind of trickle out across the economy” so long as the U.S. remains locked into fossil fuels.

The oil crunch has forced different realities on India, China and Pakistan, with each dealing with the current disruptions to trade flow through the Strait of Hormuz differently. 

“India is likely to rely more heavily on Russia. China has better fuel stockpiles and also access to a more diverse network of supply, including but not limited to Russia,” said Dan Markey, senior fellow with the South Asia program of the Stimson Center, a global affairs think tank. Acute energy shortages in Pakistan, he said, could lead to “more smuggling across its border with Iran” and in each case “local populations will blame the U.S. and Israel for price spikes and wider economic consequences” from a protracted war. 

In emailed comments, Markey wrote that Russia was “the most obvious winner from the current situation,” since Washington signaled it would lift sanctions on Russian oil, permitting its purchase by India, for 30 days. “China also comes out ahead because of its import diversification strategy and its leadership in non-hydrocarbon energy technologies,” he said.

Because of its fragile economy and exposure to high risk due to its reliance on the Persian Gulf, Markey said Pakistan “will have every reason to turn to China for renewable energy technologies” and it’s likely that “India could also expand its imports of renewable energy technologies in ways that make it less vulnerable to Middle East disruption over time.” But this outlook could change radically, he cautioned, if the war resulted in a weaker Iran that made “Middle East energy cheaper and more reliable.”

The prospects of a protracted war and its economic consequences for consumers in the U.S. and elsewhere have also triggered a debate about whether sustained high oil prices will ultimately accelerate the shift to renewables and energy independence.  

Jon Gordon, senior director with Advanced Energy United, a clean energy advocacy group, said the war and accompanying oil‑price spike “serve as a reminder of the benefits of clean energy that are not dependent on fuel prices.” 

Gordon told Inside Climate News that “high fossil fuel prices will accelerate adoption of renewables,” but the real frustration is that President Donald Trump and some red‑state politicians have turned what he called an “undeniably beneficial” economic proposition into an ideological fight, cutting tax credits and creating roadblocks to adoption. He said the current crisis underlines that if leaders are serious about affordability and shielding consumers from geopolitical shocks, “you better start supporting clean and renewable energy, because that’s how you’re going to get there.”

Columbia University’s Rajendran was skeptical if the current crisis will accelerate diversification away from oil, saying that while the European countries might view the situation this way, “the dependencies likely just shift to other regions, notably China.”