The Iran War May Be Permanently Rewiring Global Energy Security
Cambridge Professor Helen Thompson warns that energy disruption triggered by the US-Israel attack on Iran is exposing deep vulnerabilities.
Fire on an oil tanker in the Persian Gulf after it was struck by Iranian forces in early March.
Source: Iraqi PortsSubscribe to Merryn Talks Money on Apple Podcasts
Subscribe to Merryn Talks Money on Spotify
The US-Israel war with Iran is emerging as more than a humanitarian crisis, one that’s left thousands of civilians dead and millions displaced. On this week’s Merryn Talks Money, Cambridge University professor Helen Thompson argues that the fighting also could accelerate a broader geopolitical reset in energy, with consequences for oil, gas and shipping flows extending from the Persian Gulf to Europe and Asia. Even if hostilities ease, she says, assumptions that underpinned global markets for decades—including the reliability of transit routes and the ease of replacing disrupted supply—have been badly shaken.
Thompson says the biggest immediate effects may be felt not only in crude markets, but in refined products and liquefied natural gas, especially for countries reliant on Gulf exports. Europe, and Britain in particular, look vulnerable because of their dependence on imported aviation fuel, diesel and gas, while Asian economies may retain more flexibility through coal and diversified supply. The result, she suggests, is a world of more fragmented pricing, tighter supply and heightened economic risk.