By Ed Ballard

Whenever some crisis rocks oil and gas markets you'll hear the energy-security argument for going green. Import-dependent countries should ditch fossil fuels to reduce their exposure to capricious commodity prices, the logic goes. Reducing emissions is a bonus.

With conflict in the Middle East disrupting the flow of oil and gas through the Strait of Hormuz (scroll down for a roundup of Iran energy news), it's a good moment to ask whether this kind of disruption really does speed up decarbonization.

"It's not a silver bullet," says Anastasia Pavlenko, an energy researcher who recently published a paper asking that question.

She and co-author Aleh Cherp had a nearby view of the latest crisis. Having visited Israel for academic gatherings (mostly canceled), they talked to me from Cyprus after a taxi to Egypt and a rescue flight.

What energy security means depends on where you are. The U.S. has abundant fossil fuels. Higher prices hurt consumers but don't represent the same vulnerability they do in import-dependent China, which built an energy strategy on domestic coal and renewables.

Pavlenko and Cherp examined what happened in Europe after Russia invaded Ukraine. In the immediate aftermath, there was talk that the loss of Russian gas would revive coal as Germany fired up some plants. But the green-resilience argument took hold.

"The European Green Deal is the answer to both our energy security and our climate challenges," said European Union climate chief Wopke Hoekstra in 2023, referring to the bloc's emissions-cutting plan.

But when Pavlenko and Cherp examined the data, they saw no big postcrisis course-change. Wind-turbine installations chugged along. Solar power, already accelerating thanks to falling costs, got a modest boost. Emissions continued declining due to green electricity and deindustrialization, but the rate didn't change much.

"There are social and technical constraints which don't allow you to build faster," such as lengthy planning fights, Cherp said.

A crisis is also a tough time to overhaul the way we use energy. The Ukraine price shock led European governments to subsidize gas bills. That squeezed budgets for funding heat pumps, which cost more upfront than boilers.

This doesn't mean the Iran conflict, should it cause a prolonged period of higher oil and gas prices, won't change the energy world.

Constraints aren't universal. After the 1970s energy crisis, nuclear plants appeared quickly. Environmental regulations were looser; nuclear plants need less land and affect fewer people than wind farms.

In Pakistan, the 2022 crisis led to a solar boom. Pakistan imports liquefied natural gas, and suddenly Europe was buying it up. Cue rocketing bills, blackouts -- and solar panels appearing on homes, factories and farms. LNG demand fell.

Pakistan still gets nearly all its LNG from Qatar and will suffer if shipments don't resume, but the impact won't be as painful for those with solar panels.

It was a consumer-led energy-security strategy. Thanks to cheap Chinese technology, it was green.

But deeper reforms are harder to execute. After the 2022 gas-price crisis, Vietnam hatched ambitious plans to meet soaring energy demand with renewables. It hasn't finalized them yet.

"Perhaps the current Middle East crisis will provide the necessary catalyst," said Grant Hauber, an Asia expert at the Institute for Energy Economics and Financial Analysis.

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What to Know About the Iran Conflict

The standstill in the Strait of Hormuz. Roughly a fifth of the oil the world consumes each day is trapped in the Persian Gulf. Here's a visualization of the shutdown.

China prepared for this. The country stored up 1.26 billion barrels of oil in the nick of time. The strategy is helping contain energy prices.

Why global oil prices are climbing faster. The premium for for Brent crude over WTI, the U.S. benchmark, hit its widest in more than two years.

The U.S. exporter poised to gain. A bidding war for LNG is starting as conflict throttles Qatar's exports. A shortage would hurt importers but benefit Venture Global.

Frackers might sit this one out. High oil prices are a chance to lock in prices and return cash to investors. The U.S. isn't expected to drill more unless prices stay high for months.

Coal prices rise. Rising natural-gas prices boost the dirtiest fossil fuel. "Arguably only nuclear is more reliable in a supply-chain sense," said OPIS analyst James Stevenson.

The Data Point

Brent crude, the global benchmark, has risen 15% to above $83 a barrel since Friday -- not yet the kind of move that causes recessions. One reason for the muted response is that oil production has been outpacing demand, reducing the economic risk associated with military action in Iran.

"The world is very well supplied with oil right now, and I think it gives President Trump more leverage in his geopolitical actions to not worry about a crazy spike in oil prices," Energy Secretary Chris Wright said on CNBC in February, weeks before the Iran attacks.

But much of that theoretical oversupply is currently off limits. Analysts predict prices of $100 a barrel or more in the event of prolonged disruption to Middle East oil traffic.

"With the regional concentration of this spare capacity inside the Gulf, and the Strait of Hormuz closed, at least for the time being, the world effectively has little spare capacity," said Meghan O'Sullivan, director of Harvard University's Belfer Center for Science and International Affairs.

About Us

WSJ Climate & Energy offers news, analysis and exclusive data focused on the intersection of business, money and climate. You'll find highlights from across Dow Jones, including The Wall Street Journal, Barron's, MarketWatch and Investor's Business Daily, plus data and analysis from OPIS, Chemical Market Analytics and McCloskey.

Today's email was written by Ed Ballard in London. Contact him at ed.ballard@wsj.com. Contact the team at climate@wsj.com.

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March 05, 2026 09:25 ET (14:25 GMT)

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