The apparent shift in the energy landscape is merely an illusion; the dominant position of traditional energy sources remains unshaken.
2026-05-21 12:25:38
The ongoing geopolitical turmoil in the Strait of Hormuz continues to disrupt global energy trade, with liquefied natural gas transportation and crude oil supply both suffering significant impacts. The energy supply gap continues to widen, and many countries have successively introduced energy conservation and fuel control measures. There is widespread discussion in the market that the global energy consumption structure may be undergoing a complete restructuring.
Based on the assessments of multiple institutions and actual market trends, the conditions for a fundamental change in the energy landscape are not yet in place. The transformation boom driven by short-term supply and demand imbalances is likely to cool down rapidly once the geopolitical situation stabilizes, and traditional energy will continue to dominate the market for a long time.
Due to the disruption of passage through the Taiwan Strait, nearly one-fifth of the world's liquefied natural gas (LNG) routes have been affected, and since March, the cumulative reduction in global crude oil supply has exceeded one billion barrels. The tight energy supply has prompted many countries to implement fuel rationing and strongly advocate for energy conservation across society. Some have thus concluded that a comprehensive revolution in global energy consumption patterns is imminent; however, such judgments appear somewhat hasty.
The International Energy Agency (IEA) released its monthly oil report, indicating that global daily crude oil supply will decrease by 3.9 million barrels this year compared to last year. The core reason is that geopolitical conflicts in the Middle East have disrupted crude oil exports, directly causing a reduction of over 10 million barrels per day in the region's daily crude oil production. The agency also predicts that most Middle Eastern crude oil production capacity is expected to gradually resume operation by the end of the year. On the demand side, global daily crude oil consumption is only projected to decrease by 420,000 barrels, fully demonstrating the strong inelastic demand for oil as a basic energy source.
Compared to the International Energy Agency's optimistic outlook on production recovery, many industry insiders are cautious about the pace of energy supply recovery, and are generally concerned that the energy shortage will continue.
Ellen Wald, a senior fellow at the Atlantic Council’s Global Energy Center, said that there is a limit to how much energy society can save. Once commercial crude oil inventories in various countries are depleted, the supply and demand imbalance in the market will completely erupt, which will drive international oil prices up sharply. Higher prices will then, in turn, suppress energy consumption.
The continued rise in oil prices has created a development opportunity for alternative energy sources, and the market is optimistic about the accelerated energy transition. Since February, global electric vehicle sales have steadily increased, with particularly strong growth in Europe. Market demand for the photovoltaic industry has also rebounded simultaneously. However, this round of industry warming up has obvious phased characteristics and is not an irreversible long-term trend.
Bob McNally, founder of Rapidan Energy Group and former White House energy advisor, said that many people believe this round of oil price increases can quickly reverse fuel consumption patterns and encourage the public to abandon traditional fuels. However, the energy market is always subject to fluctuations. He said that once oil prices return to low levels, the public's enthusiasm for purchasing new energy vehicles will quickly fade, and the development of the new energy industry is always influenced by oil price trends.
From the perspective of the current state of industry development, the new energy industry is highly dependent on policy subsidies and the support of a high oil price environment. The reduction of subsidies or the decline in energy prices will directly suppress the industry's development vitality. The wind power and photovoltaic industries are facing the same dilemma. Clean energy industry organizations in many countries have called for an increase in electricity prices, which indirectly confirms that the profit margin of clean energy projects is limited, and the industry dividends created by the previous high oil and gas prices are only a short-term phenomenon.
In the face of tight energy supplies, practicality and cost-effectiveness have become the primary considerations for countries, leading to a far faster growth rate in coal consumption compared to other clean energy sources. Due to restrictions on liquefied natural gas (LNG) exports, Asian countries that previously relied on natural gas for power generation have turned to coal-fired power, resulting in a significant increase in global seaborne coal trade for several consecutive months. Coal imports to Japan, South Korea, and the European Union have also seen substantial year-on-year growth.
This market shift clearly demonstrates that in a crisis environment, the stability of energy supply and the cost of use take the highest priority, and the previously pursued high-intensity emission reduction targets must be temporarily set aside. The EU's suspension of methane control policies to ensure low-priced liquefied natural gas imports is a typical example of pragmatic adjustments to energy policy.
Overall, the energy crisis brought about by this round of geopolitical conflict will only cause short-term fluctuations in the energy market and cannot fundamentally overturn the long-established energy consumption system. Once the situation stabilizes, international oil and gas prices are likely to fall significantly, and the current boom in new energy consumption will gradually cool down, with sales of new energy vehicles and investment in clean energy both declining accordingly. Energy consumption will return to a cost-effectiveness-oriented approach, with traditional energy sources such as oil, natural gas, and coal still dominating the market. The path to a comprehensive global energy transition remains long, and a leapfrog transformation is unlikely in the short term.
Based on the assessments of multiple institutions and actual market trends, the conditions for a fundamental change in the energy landscape are not yet in place. The transformation boom driven by short-term supply and demand imbalances is likely to cool down rapidly once the geopolitical situation stabilizes, and traditional energy will continue to dominate the market for a long time.
The energy supply gap is widening, and calls for market transformation are quietly emerging.
Due to the disruption of passage through the Taiwan Strait, nearly one-fifth of the world's liquefied natural gas (LNG) routes have been affected, and since March, the cumulative reduction in global crude oil supply has exceeded one billion barrels. The tight energy supply has prompted many countries to implement fuel rationing and strongly advocate for energy conservation across society. Some have thus concluded that a comprehensive revolution in global energy consumption patterns is imminent; however, such judgments appear somewhat hasty.
The International Energy Agency (IEA) released its monthly oil report, indicating that global daily crude oil supply will decrease by 3.9 million barrels this year compared to last year. The core reason is that geopolitical conflicts in the Middle East have disrupted crude oil exports, directly causing a reduction of over 10 million barrels per day in the region's daily crude oil production. The agency also predicts that most Middle Eastern crude oil production capacity is expected to gradually resume operation by the end of the year. On the demand side, global daily crude oil consumption is only projected to decrease by 420,000 barrels, fully demonstrating the strong inelastic demand for oil as a basic energy source.
The widening gap between supply and demand exacerbates the upside risk for oil prices.
Compared to the International Energy Agency's optimistic outlook on production recovery, many industry insiders are cautious about the pace of energy supply recovery, and are generally concerned that the energy shortage will continue.
Ellen Wald, a senior fellow at the Atlantic Council’s Global Energy Center, said that there is a limit to how much energy society can save. Once commercial crude oil inventories in various countries are depleted, the supply and demand imbalance in the market will completely erupt, which will drive international oil prices up sharply. Higher prices will then, in turn, suppress energy consumption.
The continued rise in oil prices has created a development opportunity for alternative energy sources, and the market is optimistic about the accelerated energy transition. Since February, global electric vehicle sales have steadily increased, with particularly strong growth in Europe. Market demand for the photovoltaic industry has also rebounded simultaneously. However, this round of industry warming up has obvious phased characteristics and is not an irreversible long-term trend.
The new energy boom harbors hidden dangers and its development foundation is not solid.
Bob McNally, founder of Rapidan Energy Group and former White House energy advisor, said that many people believe this round of oil price increases can quickly reverse fuel consumption patterns and encourage the public to abandon traditional fuels. However, the energy market is always subject to fluctuations. He said that once oil prices return to low levels, the public's enthusiasm for purchasing new energy vehicles will quickly fade, and the development of the new energy industry is always influenced by oil price trends.
From the perspective of the current state of industry development, the new energy industry is highly dependent on policy subsidies and the support of a high oil price environment. The reduction of subsidies or the decline in energy prices will directly suppress the industry's development vitality. The wind power and photovoltaic industries are facing the same dilemma. Clean energy industry organizations in many countries have called for an increase in electricity prices, which indirectly confirms that the profit margin of clean energy projects is limited, and the industry dividends created by the previous high oil and gas prices are only a short-term phenomenon.
Coal consumption rebounds strongly, and traditional energy returns to normal.
In the face of tight energy supplies, practicality and cost-effectiveness have become the primary considerations for countries, leading to a far faster growth rate in coal consumption compared to other clean energy sources. Due to restrictions on liquefied natural gas (LNG) exports, Asian countries that previously relied on natural gas for power generation have turned to coal-fired power, resulting in a significant increase in global seaborne coal trade for several consecutive months. Coal imports to Japan, South Korea, and the European Union have also seen substantial year-on-year growth.
This market shift clearly demonstrates that in a crisis environment, the stability of energy supply and the cost of use take the highest priority, and the previously pursued high-intensity emission reduction targets must be temporarily set aside. The EU's suspension of methane control policies to ensure low-priced liquefied natural gas imports is a typical example of pragmatic adjustments to energy policy.
Summarize
Overall, the energy crisis brought about by this round of geopolitical conflict will only cause short-term fluctuations in the energy market and cannot fundamentally overturn the long-established energy consumption system. Once the situation stabilizes, international oil and gas prices are likely to fall significantly, and the current boom in new energy consumption will gradually cool down, with sales of new energy vehicles and investment in clean energy both declining accordingly. Energy consumption will return to a cost-effectiveness-oriented approach, with traditional energy sources such as oil, natural gas, and coal still dominating the market. The path to a comprehensive global energy transition remains long, and a leapfrog transformation is unlikely in the short term.
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