The following should not be understood as financial or any other sort of professional advice.
The ongoing(?) Iran War has done what decades of debate over climate change could not: turned rapid clean-energy deployment from an environmental aspiration into an urgent international security and economic priority.
But energy crises are nothing new. The 1973 Yom Kippur War, 1979 Iranian Revolution, and 2022 Invasion of Ukraine all resulted in oil shocks that spurred acute demand for renewable energy alternatives – until oil supply and demand eventually snapped back.
Will history repeat itself again, or will this moment represent a tipping point for the energy transition?
Let’s look at some numbers.
Since the war began in February:
We’ve experienced what the International Energy Agency calls “the largest supply disruption in the history of the global oil market.”
Oil prices soared above $100 per barrel for the first time since Russia invaded Ukraine in 2022 (peaking around $126 in April).
The World Bank’s fertilizer price index rose over 12% in Q1 2026, its highest since October 2022.
The Strait of Hormuz’s closure cut flows of approximately one-fifth of the world’s oil and liquefied natural gas (LNG).
The vulnerability of the Red Sea, where about 12-15% of global maritime trade passes every year, became a serious new concern due to the threat of Houthi attacks.
The OECD expects global GDP growth to slow from 3.4% in 2025 to 2.8% in 2026, because of the conflict it’s calling “the dominant force shaping the global economic outlook.”
Conversely, the war has been an enormous growth driver for green industries (and we’ll get into those numbers shortly).
The more interesting story though isn’t that the Iran War has been bad for oil and good for renewables - it’s that as American hegemony becomes more precarious, humanity can expect more geopolitical conflict, less reliable supply chains, and potentially intolerable oil and gas cost volatility.
Shock and Shock
Consider that the Iran War is the second major international fuel shock in just four years.
Russia’s 2022 invasion of Ukraine demonstrated just how fast energy dependence by one country (or continent) on another turns into a catastrophic vulnerability. Russia supplied over a third of Europe’s gas pre-invasion, but post-invasion exports to Europe fell roughly 80%, sending prices to record highs and forcing a rapid restructuring of energy markets and trade flows.
Iran’s Strait of Hormuz shenanigans are the same thing all over again - another oil shock with wide-ranging economic ripple effects. And barring another Iranian revolution that finally ends the Ayatollah’s reign of terror – may it come swiftly, in our days - if/when a ceasefire holds, there’s no guarantee shipping and insurance firms will ever again feel confident about long-term safe passage through the Strait of Hormuz.
Can Mass Adoption of Renewable Energy Prevent Future Energy Crises?
Even though cleantech mineral resources also have geopolitically exposed supply chain choke points, once a solar or wind project is built it doesn’t need a constant supply of imported fuel.
As such, any country that shifts and diversifies its energy reliance to domestic renewables generation, storage, and/or nuclear will be far less exposed to the price shocks caused by wars and other disruptions.
We’re now watching this play out. For example, Southeast Asia was heavily reliant on oil shipped through Hormuz, but within weeks of the war’s start:
Malaysia launched solar rebates for up to 50,000 homeowners.
Indonesia announced plans for 100 GW of solar buildout.
The Philippines activated 250 MW of solar and 450 MWh of storage.
Cambodia scrapped import taxes on EVs, solar, and storage.
Thailand approved a THB 5 billion energy-transition loan scheme.
In addition to governments, markets are responding to the changing circumstances.
Solar exports from China rose 84% from March 2025 to 2026.
Solar is now Asia’s third-largest electricity source, ahead of gas.
Wind power is also on an upswing, with European wind firms like Vestas and Ørsted both beating Q1 2026 earnings expectations.
New EV registrations rose 34% year-on-year across 17 European markets.
EV and plug-in hybrid sales grew 80% in Asia (ex-China), and 75% in Latin America in Q1, led by Brazil and Mexico.
Clean energy ETFs have been outperforming traditional-energy ETFs since the war began, with various funds up more than 35% YTD.
The US remains something of an outlier in respect of these trends, partly because substantial domestic oil and gas production has softened the stateside oil shock. Even so, solar recently overtook coal in US generation for the first time ever, and high gas prices are causing serious political repercussions.
Is This Time Different (for Renewables)?
Is this just a wartime blip that will fade into the past, like the oil shock of 1973 did?
Maybe. But there’s evidence suggesting otherwise.
A March 2026 Climate Opinion Research Exchange poll found renewables had the highest perceived 10-year returns of any energy source, with oil and coal the lowest.
We may also see a deeper shift in public perception of energy supply options. For years critics called the transition too expensive, unreliable, and idealistic. Now gas is the expensive option and Middle East-routed fossil fuels appear unreliable.
Renewables adoption is no longer (just) about climate. It’s about security and resilience.
It’s likely too early to tell whether it is, in fact, different this time. But more likely what we’re witnessing is another global energy conflict pushing the transition along faster, rather than causing an overnight revolution.
New Problem: Is the World Trading Fossil Over-reliance for Cleantech Over-reliance?
Weaning the world off oil appears to be unambiguously good for the environment. But there is a real risk that much of the world simply swaps one dependency for another, because most of the technology powering the green transition comes from China.
In 2024, China accounted for over 85% of global solar module production, with the next-largest producer, India, at just 3.3%.
Its dominance of polysilicon, ingots, wafers, cells, and modules production is likewise unquestionable.
It’s largely the same story in wind, EVs, and cleantech’s essential materials.
In the West, we are missing the big picture. We still largely think about energy resources as in the ground somewhere.
China isn’t skating to where the puck is, but where the puck is going. It’s thinking, “Who makes the solar panels? Who makes the turbines?” It’s positioning itself as the Saudi Arabia of green technology manufacturing.
(I raised this point recently on a Toronto Climate Week panel about AI and its impact on sustainable energy, which you can watch here.)
Once upon a time, a long four years ago, the US federal government seemed to understand this, when the Biden Administration passed the Inflation Reduction Act, which provided a massive package of financial incentives for American development and deployment of green technologies.
Now the United States, under new leadership, is not so much skating where the puck is or is going - it’s just melting the ice.
But the world is not America.
And even in America, the markets are moving in the right direction, notwithstanding federal policy.
Special thanks to my articling student Abbey Butler for her work on this article.