U.S.-Iran Conflict Accelerates Global Clean Energy Transition
While the United States and Iran have avoided a full-scale war, the ceasefire following nearly four months of conflict continues to be challenged by escalating tensions around the Strait of Hormuz. However, one outcome of this crisis has become clear: the clean energy transition is accelerating globally with no signs of slowing down.
This conflict is merely one in a recent series of geopolitical tensions rocking the oil and gas markets, leaving global increasingly wary of dependence on imported fossil fuels and highlighting the energy independence benefits of solar power.
Asian Markets Suffer Most Severe Impacts
No region in the world has been more heavily affected by the closure of the Strait of Hormuz than Asian markets. Before the U.S. and Israel launched their joint military operation against Iran on February 28, one-fifth of global oil and gas trade flowed through the Strait of Hormuz daily, heading east from the Persian Gulf.
Of the approximately 20 million barrels of oil and oil products passing through the strait each day before the conflict, about 80% of oil and 90% of natural gas were destined for Asian markets.
| Oil and Gas Flow Through Strait of Hormuz (Pre-Crisis) | Primary Destinations |
|---|---|
| 80% of crude oil | Asian markets |
| 90% of natural gas | Asian markets |
| 20 million barrels/day | Total oil and oil products |
When the strait was closed for the military operation, Asian markets were heavily and immediately impacted by the disrupted flow. Particularly, Southeast Asia proved extremely vulnerable to price fluctuations due to the region's relatively high dependence on energy imports and low capacity to absorb market volatility.
Crisis Fuels Renewable Energy Revolution
The consequences of the crisis have been concrete rather than hypothetical—the Philippines declared a national energy emergency in March, and governments across the region implemented energy rationing, work-from-home mandates, and even four-day workweeks to manage the pressure.
Yet it is this same crisis that has initiated the necessary renewable energy revolution that will help the region become more secure, independent, and self-sufficient in energy for the future.
Rooftop solar power, in particular, is experiencing robust growth in countries including the Philippines, Indonesia, Cambodia, and Malaysia as citizens seek alternative energy solutions amidst rising prices and unreliable grid stability.
Renewable Energy: From Risk to Reliable Solution
This reflects a major shift occurring in global energy policy and security thinking. Historically, regarding energy security, fossil fuels represented stability and reliability, while solar and wind power were viewed as riskier due to variable production and the relative novelty of supply chains.
Now, that narrative has reversed. Driven largely by the prolonged energy crisis originating from the Strait of Hormuz, renewable energy is increasingly being seen as the more reliable, less geopolitically risky option.
"Wind and solar power cannot be embargoed, blockaded, or cut off by a foreign power," David Frykman, General Partner at Stockholm-based venture capital group Norrsken, wrote in a commentary for Fortune earlier this year. "Every terawatt-hour of domestically produced renewable energy is a terawatt-hour that no adversary can weaponize."
Economic and Political Benefits of Solar Power
Oil and gas must be supplied from nations rich in natural resources, leading to major geopolitical chokepoints like Hormuz. In contrast, solar and wind power are far more decentralized and democratic, with the potential to be produced—to varying degrees of efficiency—anywhere where people are concentrated.
Beyond this strategic benefit, solar power is now the cheapest form of energy on Earth, making the renewable energy transition an obvious choice for countries like Indonesia and the Philippines that have experienced significant disruption due to import dependence.
This is no longer about climate crisis—solar power simply makes better economic and political sense.
"For years, clean energy was sold as a moral obligation. Now, it is simply an economic and geopolitical necessity," Forbes reported earlier this year. "It's no longer about emissions. It's about resilience and price stability."
Shifting the Balance of Energy Power
This development not only helps isolate Southeast Asian power grids from global energy market fluctuations but is also further shifting the balance of energy power away from the West and toward China.
China's near-total dominance over global clean energy technology manufacturing and supply chain has positioned the country ideally to become an increasingly indispensable trading partner in emerging markets.
The Philippines stands as the clearest example—it has become China's second-largest solar export market this year, after the Netherlands and ahead of Pakistan—with Chinese solar exports to the country exceeding 4,000 megawatts in just the first four months of 2026, according to energy consultancy Ember.
The escalating tensions between the U.S. and Iran, though de-escalated, have left a lasting legacy: a world more acutely aware of the risks of fossil fuel dependence and an irreversible shift toward renewable energy as a solution for economic and geopolitical security.