The global push to move away from oil and gas has long been framed as a response to the effects of climate change and the need to take care of the planet. But a widening group of strategists, analysts, and industry participants argue that the transition is being reshaped by a different, more immediate driver: energy security.
The disruption to global energy markets tied to the war in Iran and escalating attacks on infrastructure in the Middle East has sharpened concerns about the vulnerability of fossil fuel supply chains, prompting renewed debate about how countries can reduce reliance on imported hydrocarbons.
"One of the predictions you can make out of what's happening is that it's going to turbocharge the energy transition," Jeff Currie, chief strategy officer of energy pathways at Carlyle, said at CERAWeek by S&P Global, a major energy industry conference, last week.
"The energy transition never had anything to do with climate change ... Security was always paramount."
In the past four weeks, since the US and Israel launched a major barrage of airstrikes against the Iranian regime, the ensuing conflict has engulfed the Middle East and wracked global supply chains in what has become the largest energy disruption on record.
The Strait of Hormuz, the world's most critical chokepoint for oil shipments, has been effectively closed by threats of violence from the Iranian regime, cutting off roughly 16 million barrels per day of oil from the global market. Futures prices on Brent crude (BZ=F), the international oil pricing benchmark, and US benchmark West Texas Intermediate (WTI) crude (CL=F) have gained more than 40% since the conflict began.
Currie and others argue the geopolitical shock underscores a longstanding reality: Oil and gas are uniquely portable and tradable energy sources, but those same characteristics that make the products global commodities also make them susceptible to disruption by other nations. Supply disruptions, shipping risks, and price spikes can ripple through economies within weeks.
"You import a solar panel or an electric car only once," Roger Diwan, vice president of financial services at S&P Global Commodity Insights, said at CERAWeek. "You import oil every day."
That distinction is becoming more salient as governments confront a world in which globalization — and the security guarantees that support a globalized system — appears less certain. Energy supply chains built around open sea lanes and stable trading relationships are increasingly being tested by war, sanctions, and political fragmentation.
Russia's invasion of Ukraine in 2022 exposed the fragilities of Europe's energy system after years of deepening dependence on Russian pipeline gas. Before the war, Russia supplied roughly 40% of the European Union's natural gas, much of it flowing through the Nord Stream pipeline system into Germany.
When flows began to drop — first through political pressure, then through outright disruptions — the shock cascaded across the continent. Power prices surged to record highs, industrial users curtailed production, and governments were forced into emergency measures to secure supply ahead of winter.
A docked oil tanker is unloading crude oil at the port in Qingdao, in China's eastern Shandong province, on March 25, 2026. (CN-STR/AFP via Getty Images) ·- via Getty Images
The situation worsened dramatically after the sabotage of the Nord Stream pipelines in September 2022. The loss of that infrastructure forced a rapid and costly pivot to global liquified natural gas (LNG) markets, driving intense competition with Asia for cargoes and pushing benchmark European gas prices (TTF=F) to multiples of historical norms.
The crisis accelerated inflation, strained public finances through subsidy programs, underscoring a key vulnerability: Europe's reliance on imported energy.
The US, by contrast, enters the current shock from a more insulated position. Thanks to the shale boom, the US is the world's largest producer of oil and natural gas, reducing its direct exposure to physical supply disruptions — but the country isn't entirely isolated. Oil is globally priced, and disruptions in the Middle East still feed through to gasoline and diesel costs, while rising LNG exports are increasingly linking US natural gas prices to global markets.
For large energy importers in Europe and Asia, however, the exposure remains more acute. Countries dependent on seaborne crude and LNG must compete for cargoes in stressed markets, amplifying both price volatility and supply risk during geopolitical disruptions.
Currie pointed to historical precedents such as the 1973 oil embargo, when global demand fell sharply because supply was cut off. "It didn’t happen because people wanted it to," he said. "It was forced on them."
Today's shock could have similar consequences, analysts say — not only in the form of short-term demand destruction driven by high prices, but also through longer-term shifts in investment and consumption patterns.
Frederic Lasserre, head of market intelligence at trading firm Gunvor, said sustained price increases could alter consumer behavior in ways that prove difficult to reverse.
"If price remains high for long enough, you change habits," Lasserre said at CERAWeek. "You decide to go for an EV. That type of demand destruction is less reversible."
Karim Fawaz, a director in the energy and natural resources group at S&P Global Energy, estimated electric vehicles alone are already reducing global oil demand by roughly 1.3 million barrels per day — a figure that could rise if governments respond to geopolitical shocks with stronger incentives for electrification.
The shift toward energy security is also influencing investment decisions. Pablo Hernandez Schmidt-Tophoff, global head of infrastructure at Lazard, said asset valuations have begun to reflect a renewed emphasis on resilience rather than purely financial returns.
Even in advanced economies, electric vehicle adoption has often relied heavily on government incentives, while demand for refined products has proven more resilient than expected. (AP Photo/George Walker IV) ·ASSOCIATED PRESS
"The name of the game is energy security and energy resiliency, even at the detriment of capital efficiency," he said.
The shift is unlikely to be immediate or uniform. Analysts and industry executives cautioned that much of the developing world remains structurally dependent on oil, particularly in regions with limited electricity infrastructure.
Even in advanced economies, electric vehicle adoption has often relied heavily on government incentives, while demand for refined products has proven more resilient than expected. In Norway, where EVs account for more than half of new car sales, oil demand has remained relatively stable — underscoring the difficulty of rapidly displacing hydrocarbons at scale.
In the US, the Trump administration has rolled back several major "green" initiatives, including the cancellation of several major wind and solar projects. In a press conference at CERAWeek, Secretary of the Interior Doug Burgum announced that the US will pay French energy giant TotalEnergies (TTE) $1 billion to cancel its plans for a major offshore wind development along the US East Coast and instead invest that money into hydrocarbon infrastructure.
The International Energy Agency has also projected that demand for hydrocarbons could continue to grow through 2050, especially as the developing world remains dependent on oil imports for economic growth.
Yet, even if demand proves more durable than expected, the current shock is accelerating a reordering of how that demand is met — and how countries think about securing it. Carlyle's Currie said such shifts could ultimately accelerate the transition away from hydrocarbons in a way shaped less by environmental ambition than by necessity.
"We're going to get an energy transition forced on us in a very painful way," Currie said at CERAWeek. "Security is going to be on top no matter what."
Jake Conley is a breaking news reporter covering US equities for Yahoo Finance. Follow him on X at @byjakeconley or email him at jake.conley@yahooinc.com.
