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For most of the twentieth century, control over energy meant control over power. Not just the power to keep the lights on, but the kind of power that moved armies, swayed elections and determined which nations got to write the rules. That equation has always rested on a single, uncomfortable truth: the world’s most critical fuel is buried unevenly beneath the earth, and getting it to where it is needed requires passing through a handful of narrow maritime corridors that a determined actor could, in theory, close.
The ongoing conflict between the United States, Israel and Iran is a stark reminder of how little this has changed. Each new escalation in the Gulf sends tremors through global oil markets. Shipping insurance premiums spike. Analysts sharpen their pencils and revise their inflation forecasts. The strait of Hormuz, a corridor barely 33 kilometres wide at its narrowest point, holds the global economy hostage by sheer virtue of geography. Roughly one in five barrels of traded oil passes through it every single day.
But what if the underlying energy system were built differently? What if the transition to renewable energy had already run its course, and the world had reorganised itself around wind, solar, batteries and electric transport? The same military tension, the same rhetoric and the same threats would still exist. Would the economic fallout look anything like what we experience today?
How Fossil Fuels Created a World of Chokepoints
To appreciate what might change, it helps to understand why the current system is so uniquely fragile. The global fossil fuel economy was not designed with resilience in mind. It evolved organically around the geology of oil and gas deposits, which happen to be concentrated heavily in the Middle East, parts of Russia and a handful of other politically complex regions.
Moving that fuel to consumers across Europe, Asia and the Americas requires a network of pipelines and supertanker routes that funnel through a small number of strategic passages. The Strait of Hormuz, the Suez Canal, the Strait of Malacca and the Bab el-Mandeb collectively represent the circulatory system of the global economy. Block any one of them, and the effects ripple outward almost immediately. Oil markets are liquid, globally priced and highly reactive to sentiment. A threat is sometimes enough to move prices, long before any actual disruption materialises.
Because oil and gas underpin so much of the real economy, including transport, agriculture, plastics, heating and electricity generation in many countries, a price shock at the commodity level transmits rapidly into consumer prices. Governments that depend on subsidised fuel to manage social stability find themselves suddenly exposed. Central banks face the unpleasant choice between tolerating inflation or tightening into a slowdown. The geopolitical leverage that comes from sitting astride a chokepoint is, in this system, enormous.
What a Renewable World Would Actually Look Like
The alternative scenario requires a genuine stretch of imagination, not because it is implausible but because the transition is so far from complete. Today, fossil fuels still account for around 80 percent of global primary energy consumption. A world in which that number had fallen to a small fraction would look structurally very different.
In such a world, most electricity would be generated within national or regional borders. Solar panels and wind turbines produce power close to where it is consumed, rather than extracting a resource in one hemisphere and burning it in another. Road transport would be predominantly electric, with batteries charged from grids running largely on renewables. Heating would shift to heat pumps and, in some regions, green hydrogen or district heating networks. The physical supply of energy would become far less dependent on the uninterrupted flow of tankers through contested waters.
This decentralisation matters enormously in a crisis. When the strait of Hormuz is threatened in today’s world, the anxiety is immediate and rational: a blockage means less fuel, higher prices and economic pain. In a renewably powered world, the same threat would apply to a much smaller slice of the global economy. Oil would still exist and still be traded, but it would be a diminished commodity serving residual industrial uses rather than the spine of everyday life. The automatic transmission mechanism between Gulf instability and global inflation would be severed, or at least significantly weakened.
Households with electric vehicles would have no reason to panic at a petrol price spike. Electricity bills would remain stable because generation is domestic. Governments would face far less pressure to intervene with costly fuel subsidies. The macroeconomic shock would still exist, but it would be smaller, slower and more manageable.
The New Chokepoints: Critical Minerals and Supply Chains
None of this means that geopolitics would disappear. It would transform. Renewable energy systems are not resource-free: they are resource-shifted. Wind turbines require steel, copper and rare earth elements for their magnets. Solar panels depend on polysilicon, silver and cadmium. Batteries for electric vehicles and grid storage are built from lithium, cobalt, nickel and manganese. Processing many of these minerals is currently concentrated in a small number of countries, with China dominant across several critical supply chains.
Critical mineral supply chains would therefore become a new arena for geopolitical competition, and there are already early signs of this playing out. Export restrictions on rare earths, competition for mining rights in the Democratic Republic of the Congo and diplomatic manoeuvring over lithium deposits in South America are all part of an emerging resource contest that looks, in some ways, familiar.
However, there are meaningful structural differences from the fossil fuel system. Sunlight and wind are genuinely distributed across the planet in a way that oil and gas simply are not. The concentration of mineral processing in a few countries is a current market condition that can be diversified over time, rather than a geological fact that is fixed. Strategic reserves of minerals are easier to build and stockpile than reserves of oil, which are expensive, physically cumbersome and subject to degradation. A country that builds a six-month battery stockpile is genuinely insulated in a way that oil stockpiles only partially replicate.
Perhaps most importantly, minerals do not flow through a single maritime corridor in the way that Gulf oil does. Supply chain disruptions in a renewable world would be real and costly, but they would tend to propagate more slowly and affect technology markets rather than everyday fuel prices. The feedback loop between distant geopolitical instability and household budgets would be longer and more attenuated.
Power Redistribution and the Rise of the Resource South
One of the more underappreciated consequences of an energy transition would be a significant redistribution of geopolitical influence. The petroleum age concentrated power in a relatively small group of states: major oil exporters, the multinational companies that extracted and refined their resources, and the military powers that guaranteed the security of supply routes. Communities living near oilfields often saw little benefit and bore significant environmental and social costs, with minimal recourse.
The energy transition is already reshaping these dynamics, even in its early stages. Mineral-rich regions across Africa, Latin America and parts of Southeast Asia are increasingly positioned to negotiate better terms for resource extraction, partly because global standards around community consent and environmental protection have strengthened considerably since the era when multinational oil companies operated with near-impunity. The concept of a social licence to operate is now a genuine constraint on projects in a way that it rarely was for the petroleum industry in its prime.
This does not mean that mineral-rich developing nations will necessarily benefit, or that resource extraction will become uniformly ethical. The history of commodity wealth is littered with examples of the resource curse playing out in different forms. But the structural conditions that allowed a handful of states and corporations to capture most of the value from fossil fuels are less firmly embedded in the renewable energy supply chain, which creates at least the possibility of a more distributed set of winners.
Why the Hormuz Crisis Is Also an Argument for Transition
There is a tendency in policy discussions to treat the energy transition primarily as a climate story. The decarbonisation of the global economy is framed in terms of temperature targets, carbon budgets and the need to avoid catastrophic warming. All of that is real and urgent. But the current crisis in the Gulf is a reminder that the fossil fuel system carries a different kind of cost that rarely appears in climate models: the cost of geopolitical fragility.
Every conflict that involves a major oil-producing or oil-transit region is, in part, a consequence of the extraordinary leverage that the fossil fuel geography confers. The trillions of dollars spent over decades on military deployments in the Gulf, the diplomatic accommodations made to authoritarian oil exporters and the recurring inflationary shocks absorbed by ordinary households around the world are all part of the true cost of a system built around concentrated, traded, strategically vulnerable energy.
The geopolitical case for renewable energy has never been stronger than it is in this moment. Not as a utopian promise of a conflict-free world, but as a hard-nosed argument about systemic risk. A world powered by domestically generated electricity from wind and solar is a world in which the strait of Hormuz, for all its strategic drama, simply matters less. That is not a minor point. It is arguably the most important energy security argument of our time.
The transition will not happen overnight, and it will create its own tensions and its own new forms of resource competition. But the next time oil markets spike because a general somewhere issues a threat about closing a shipping lane, it is worth remembering that this particular vulnerability was never inevitable. It was always a design choice, made by default, over a century of building an economy on the most geographically concentrated, strategically exposed form of energy humanity has ever depended on.
The question is not whether a different design is possible. It already exists, in pieces, across dozens of countries. The question is how quickly we are willing to finish building it.
