Rising fears of supply disruptions, particularly through strategic chokepoints like the Strait of Hormuz, are prompting some countries to increase oil and gas production as a short-term measure to maintain stability. Yet, energy experts argue that the same crisis is exposing the structural vulnerabilities of fossil fuel dependence, potentially accelerating investments in solar power and green hydrogen.
A recent report by the Centre for Environment and Development for the Arab Region and Europe (CEDARE) highlights that the Iran-linked conflict is placing the global energy transition on two divergent paths: either accelerating the shift to clean energy or slowing it. The report notes that soaring oil and gas prices, coupled with fears of disrupted supplies, enhance the appeal of renewable energy as a more stable and geopolitically resilient option.
However, the war is also undermining investor confidence, increasing financing costs, and disrupting supply chains for critical minerals essential to clean energy technologies, factors that could delay project implementation.
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The report outlines two possible paths: one leverages the crisis to accelerate investments in renewable energy, energy efficiency, and energy independence, while the other involves a short-term return to fossil fuels to secure supply. Ultimately, it concludes, the trajectory will depend on government policy responses. It recommends positioning the energy transition as a tool for strengthening energy security, securing critical mineral supply chains through recycling, boosting financing for clean energy projects, and protecting vital infrastructure to sustain investment and economic diversification in the region.
Across the Middle East and North Africa, the impact remains uneven. While energy-exporting countries may benefit from higher prices, import-dependent economies are facing mounting fiscal pressures.
Dr. Hesham Eissa, board member of Dcarbon Global for Environmental Consultancy and Sustainable Development, said the ongoing geopolitical tensions have effectively sidelined climate commitments for now. He explained, “there is currently no room to think about climate obligations; they have been frozen and pushed off the international agenda.” Eissa added, “energy security is the top priority, regardless of the source. What we are witnessing is a sudden, unexpected shock, and all efforts are focused on containment and stopping the economic bleeding.”
He noted that the crisis has already driven up fossil fuel prices, affecting energy supply and costs while fueling inflation. “Once the war ends, countries may begin to rethink increasing investments in renewable energy to avoid similar shocks in the future and help bridge the gap between energy demand and supply,” he said, describing this as a likely lesson learned from the conflict.
Some countries have already begun implementing energy-saving measures. Egypt, for example, has introduced policies to curb consumption, including reducing working hours and mandating earlier closing times for shops and malls. However, Eissa warned that such measures could have negative repercussions on national income and economic activity.
Looking ahead, he expects renewable energy use to increase, though it will likely remain a complementary source rather than a full substitute due to still-high investment costs.
Dr. Manel Sakhri, an Algerian environmental policy expert and researcher, said the current crisis is forcing countries into a difficult balancing act between ensuring energy supply and maintaining climate commitments. “In times like these, the priority naturally shifts toward energy security, which is why we are seeing a temporary return to oil and gas as a quick solution to avoid shortages,” she explained.
She continued, “at the same time, these crises send a clear message: relying on a single source or region is no longer a safe option. This will likely accelerate investment in renewable energy, not only for environmental reasons, but as a strategic choice to reduce risk.”
Sakhri noted that market impacts will largely depend on the level of escalation. “If tensions remain contained, price increases may be limited, perhaps in the range of 10 to 20 percent. But if escalation intensifies, especially in sensitive routes like the Strait of Hormuz, markets could become more volatile, with rising transport and insurance costs and potential redirection of supplies toward Asia,” she said.
Sakhri went on to explain, “the worst-case scenario-a major supply disruption-remains unlikely, but if it occurs, it would have significant global repercussions, not just on prices but on the broader economy.”
She added that preparedness varies across countries. Gulf states, for instance, are better positioned to absorb shocks thanks to strong infrastructure and large reserves, while others continue to face challenges related to investment and grid readiness. “There has been progress, but the current phase requires more, particularly in strategic storage and regional cooperation,” she said.
Sakhri also pointed to a growing “duality” in government strategies. “In the short term, there is increased investment in oil and gas to ensure stability. At the same time, renewable energy and green hydrogen projects are accelerating. Companies are no longer thinking in ‘either-or’ terms, but are trying to balance both,” she explained.
She described the current moment as an opportunity to restructure the region’s energy sector toward a more sustainable model, though outcomes are not guaranteed. “If this moment is used wisely, it could drive the development of a more diversified and sustainable energy system. But if the focus remains only on quick fixes, we risk returning to the same vulnerabilities,” she warned.
Dr. Ahmad Alshraideeh, an academic lecturer, stated that the geopolitical shifts resulting from the conflict have not been limited to rising oil prices but have also led to increased prices for all goods and services. He warned of an economic catastrophe if the conflict continues for an extended period, saying, “This will result in paralysis of the economic, social, and political life of most countries.”
He emphasized the need to think outside the box regarding the restructuring of energy in a more sustainable manner, as traditional solutions have proven ineffective. He also stressed the importance of having plans at the regional level to overcome the crisis and prevent similar crises in the future.
Simon Stiell, Executive Secretary of the UN Framework Convention on Climate Change (UNFCCC), echoed similar concerns, emphasizing the recurring risks of fossil fuel dependence. “This is completely delusional because history tells us this fossil fuel crisis will happen again and again,” he said at the 2026 Green Growth Summit in Brussels, adding that reliance on fossil fuels leaves economies, households, and businesses “at the mercy of geopolitical shocks and price volatility in a chaotic world.”
In the end, the war does not appear to be pushing the world back to fossil fuels entirely, nor fully toward clean energy. Instead, it is creating a dual-track trajectory, where short-term fixes coexist with long-term transitions, in an ongoing struggle between energy security and climate commitments.
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