Iran war’s energy shock spurs renewables push and Hormuz bypass plans

The ongoing conflict between the United States, Israel, and Iran — and the resulting closure of the Strait of Hormuz since late February — is reshaping the global energy landscape, pushing countries from Asia to Africa to accelerate their shift toward renewables and electrification even as analysts question how lasting the effect will be.

Asia Confronts Its Energy Vulnerability

The Institute for Energy Economics and Financial Analysis published a briefing on Wednesday arguing that renewables are "now the clear solution to Asia's energy trilemma" of affordability, reliability, and sustainability. The report follows months of disruption to a waterway that carries roughly 20% of the world's oil and nearly 19% of global LNG trade, with almost 90% of that gas bound for Asia.weforum+3

The crisis forced Asian nations into emergency mode. Several countries introduced four-day workweeks to reduce fuel consumption, while Japan reassessed its entire energy security posture. IEA Executive Director Fatih Birol said at a National Press Club event in Australia that he anticipated "one of the reactions to this crisis will be an acceleration of renewable energy adoption". The Council on Foreign Relations noted that what governments do next "will determine whether the crisis becomes a turning point or a missed opportunity".cfr+3

African Producers and the Diversification Imperative

The conflict has also reshaped calculations for African oil-producing nations. Nigeria's energy minister argued in March that Gulf producers should view Nigeria as a collaborative partner rather than a competitor to help diversify supply. Al Jazeera Alphabet Inc. ↘ 1.94% reported this week that African governments are broadly rethinking their security and economic priorities in light of the war, while analysts have noted that oil-dependent African countries like Angola and Nigeria face pressure to diversify their own energy supplies as the crisis exposes the fragility of concentrated fossil fuel dependence.aljazeera+3

Limits of the Transition Boost

Yet analysts caution that the war's push toward clean energy has structural limits. Axios reported Wednesday that the oil economy's "surprising flexibility" and plans to physically bypass the Strait of Hormuz could together constrain how much the conflict accelerates the transition. Saudi Arabia is in preliminary talks to expand its East-West pipeline capacity by up to 2 million barrels per day to route crude to the Red Sea coast without crossing the strait, while Israel's energy minister proposed a 700-kilometer pipeline from Saudi Arabia to Eilat.axios+3

The IEEFA's separate analysis published Tuesday drew five energy market lessons from the crisis, noting that renewable energy and electrification offer stronger energy security than fossil fuels. Still, the June 18 memorandum between Iran and the United States has only begun to stabilize the situation — passage through the strait has not fully returned to pre-war status, and the two sides have just 60 days to negotiate a permanent settlement.ieefa+1