Iran’s Energy Shock Sparks a New Global Realignment

The Middle East upheaval has driven oil above $100 and could reorder global energy flows for years. Beyond the immediate shock, three trends stand out: 1) China could strengthen its strategic position as LNG disruptions and a cleaner electricity push alter its energy calculus; 2) countries may rebuild inventories, shifting from just-in-time to strategic stockpiles; and 3) the crisis could accelerate diversification toward renewables and domestically produced energy, while higher gas costs keep nuclear, coal, and LNG in play. Europe faces stark lessons from overexposure to gas, and while headlines may overstate long-term impact, the aftershocks are likely meaningful.