When tensions rise around Iran, the world braces for oil shocks. Markets react, governments worry, and the Strait of Hormuz once again becomes the centre of global attention.

But in 2025, something quietly shifted beneath this familiar cycle of crisis.

Electric vehicles avoided oil consumption equivalent to nearly 70% of Iran’s exports.

According to analysis by Ember, the global EV fleet reduced oil demand by 1.7 million barrels per day, approaching the 2.4 million barrels per day exported by Iran through the Strait of Hormuz.

This is not just a milestone for clean energy. It marks the beginning of a structural change in how the world responds to geopolitical risk.

The world’s oil vulnerability is still profound

Despite rapid technological progress, the global economy remains deeply exposed to oil shocks.

Nearly 79% of the world’s population lives in oil-importing countries, making them vulnerable to disruptions in supply and price volatility.

The costs are enormous. For every $10 increase in oil prices, global import bills rise by around $160 billion annually.

At the heart of this vulnerability lies the Middle East—and specifically the Strait of Hormuz. This narrow passage carries around one-fifth of global oil exports, while the wider Gulf region accounts for 29% of global oil supply.

The concentration of supply through such a fragile corridor makes the global economy acutely sensitive to regional instability.

“This is Asia’s Ukraine moment,” said Daan Walter, principal at Ember. “Oil is the Achilles’ heel of the global economy… Asia’s oil vulnerability has been exposed by the current crisis.”

Even oil producers cannot escape the shock

One of the most counterintuitive realities of today’s energy system is that producing oil domestically does not shield economies from global price spikes.

Oil is traded in global markets. When supply is disrupted, prices rise everywhere.

In Texas, one of the world’s largest oil-producing regions, gasoline prices increased by more than 25% following recent geopolitical tensions—in some cases exceeding rises seen in oil-importing countries.

This reflects a fundamental truth: oil dependency is a global vulnerability, not a local one.

The true cost of fossil fuel dependence

The financial burden of this dependency is immense.

Net importing countries spent approximately $1.7 trillion on fossil fuel imports in 2024, with many economies losing significant portions of GDP to energy imports.

For developing economies, the impact is even more severe. Rising prices can strain public finances, disrupt industries, and increase the cost of living.

The report highlights a stark dynamic: when supply tightens, wealthier countries can outbid poorer ones, effectively pushing them out of the market.

Energy insecurity, in this sense, is not just an economic issue—it is a question of global inequality.

EVs are emerging as a geopolitical force

Against this backdrop, the rise of electric vehicles is beginning to alter the equation.

The fact that EVs avoided oil demand equivalent to 70% of Iran’s exports is not just symbolic—it is strategic.

It shows that demand-side transformation can counterbalance supply-side risk.

“Electric vehicles are increasingly cost-competitive with gasoline cars,” Walter said. “Oil volatility means EVs are a common-sense choice for countries wishing to insulate themselves from future shocks.”

The economic benefits are already visible:

• China saves over $28 billion annually in avoided oil imports
• Europe saves around $8 billion
• India saves about $0.6 billion

These savings highlight a critical shift: energy security is moving from controlling supply to reducing dependence.

A broader shift: the rise of “electrotech”

Electric vehicles are only one part of a wider transformation described in the report as “electrotech”—a combination of EVs, solar, wind, batteries, and heat pumps.

Together, these technologies can electrify more than three-quarters of global energy demand and significantly reduce fossil fuel imports.

If deployed at scale, they could cut import dependence by up to 70%, fundamentally reshaping global energy systems.

Unlike fossil fuels, which require continuous imports, these technologies provide long-term stability. Once installed, they operate without fuel costs, price volatility, or geopolitical exposure.

As the report puts it, this is the difference between “renting energy” and “owning it.”

The Strait of Hormuz: from chokepoint to turning point

The current crisis highlights the strategic importance of the Strait of Hormuz—but it may also accelerate its decline as a central pillar of global energy security.

Asia, which imports around 40% of its oil through the strait, is particularly exposed.

But unlike previous crises, countries now have viable alternatives.

Renewable energy costs have fallen sharply. EV adoption is accelerating across both developed and emerging markets. And electrification technologies are scaling faster than expected.

The report suggests this could become a defining moment—similar to how Europe’s response to the Ukraine crisis reshaped its energy strategy.

Peak oil may arrive sooner than expected

The implications extend beyond immediate crisis management.

The International Energy Agency had projected global oil demand would peak around 2029. But recent developments suggest that peak may arrive sooner.

Electrification is not only reducing demand—it is changing expectations about the future of energy.

The report notes that demand growth forecasts have already been revised downward, with the possibility that global oil demand could plateau—or even decline—earlier than anticipated.

Crises, historically, have accelerated structural transitions. This may be another such moment.

A structural shift beneath the headlines

Geopolitical tensions may dominate headlines, but the deeper story lies beneath.

The fossil fuel system—dependent on continuous trade through vulnerable chokepoints—is becoming increasingly fragile. At the same time, the technologies needed to replace it are becoming cheaper, faster, and more accessible.

The fact that EVs alone have already offset oil demand equivalent to most of Iran’s exports signals a profound shift.

It suggests that the balance of power in global energy is beginning to move—from regions that supply oil to technologies that reduce the need for it.

The Strait of Hormuz may remain a critical artery for now. But its grip on the global economy is loosening.

And for the first time in decades, the world has a credible path to reduce its dependence on it.

Fertiliser dependency has come under sharp global scrutiny as tensions around the Strait of Hormuz highlight how geopolitical disruptions can ripple through food systems, raising concerns over food security and farm resilience.

The Strait of Hormuz, a critical chokepoint for global energy supplies, plays a central role in fertiliser production due to its link to fossil fuel exports. Any disruption threatens to push up fertiliser costs—directly impacting agricultural production worldwide, according to an analysis by Zero Carbon Analytics (ZCA).

How Fertiliser Dependency Shapes Global Food Systems

Experts warn that modern agriculture’s heavy reliance on fossil fuel-based fertilisers has created a fragile system vulnerable to geopolitical shocks.

“This vulnerability is a choice, and one that we all pay for,” says Raj Patel, economist and food systems expert at the University of Texas. “Nearly 90 percent of the $540 billion in annual agricultural support goes to the same chemical-intensive production that depends on them. We didn’t stumble into this dependency. We funded it.”

The reliance is deeply embedded in global subsidies and production models, making rapid transitions difficult but increasingly necessary.

Farmers Face Rising Costs Amid Hormuz Tensions

Farmers across Asia are already feeling the pressure of rising fertiliser prices as geopolitical tensions escalate.

“With fertiliser prices rising—and the planting season soon to begin—Asia’s farmers are once again being forced to choose between rising costs and falling yields,” says Shamika Mone, President of the Inter-Continental Network of Organic Farmer Organisations.

She adds that consumers are also likely to face further food price hikes, underlining the broader socio-economic impact.

A Fragile System Under Stress

The current crisis is being described as more than just a supply issue—it is a structural problem in global agriculture.

“What we are seeing is not just a fertiliser and commodity crisis, it is a stress test to a fragile food system that is not designed to be resilient,” says Belén Citoler of the World Rural Forum.

The disruption has exposed how interconnected energy markets and food systems have become, with shocks in one quickly cascading into the other.

Agroecology and Organic Farming as Alternatives

Across continents, experts and farmers are calling for a shift toward more resilient agricultural practices that reduce fertiliser dependency.

“The conflict in Iran highlights the vulnerability of an agriculture system that is overly reliant on fossil fuel fertilisers,” says Oliver Oliveros of the Agroecology Coalition.

He points to growing efforts by countries such as Brazil, Kenya, and Vietnam to support agroecological practices that use natural fertilisers and nitrogen-fixing plants.

Farmers themselves are also adapting.

“Geopolitical conflicts… show how vulnerable our agricultural system has become,” says German farmer Olivier Jung, who has been experimenting with crop diversity and reduced external inputs to build resilience.

Similarly, Brazilian farmer Thales Bevilacqua Mendonça warns that global supply chains are increasingly unstable, urging a shift toward ecological farming practices.

Policy Shift Seen as Key to Reducing Fertiliser Dependency

Experts argue that reducing fertiliser dependency will require systemic policy changes, particularly in how agricultural subsidies are allocated.

“To speed up the transition, we need to redirect billions in agriculture subsidies… and invest in approaches that safeguard farmers and consumers from energy price volatility and climate shocks,” Oliveros adds.

Organic farming advocates also stress that proven alternatives already exist.

“If we really want to take food security seriously, policymakers must support the most resilient models… organic farming must become a pillar,” says French farmer Olivier Chaloche.

A Turning Point for Global Food Security?

The Strait of Hormuz disruption may prove to be a wake-up call for governments worldwide.

As fertiliser dependency becomes increasingly tied to geopolitical instability, the push toward agroecology, organic farming, and resilient food systems is gaining urgency.

The question now is whether policymakers will act fast enough to transform a system many experts say is no longer sustainable.

South Asia’s ambitious expansion of liquefied natural gas (LNG) infrastructure could expose the region to significant economic and energy security risks as geopolitical tensions disrupt global energy markets, according to a new report by Global Energy Monitor.

The report warns that escalating conflict in the Middle East, particularly attacks on Iran and disruptions to shipping routes in the Strait of Hormuz, could sharply affect LNG prices and supply chains, putting pressure on energy-importing economies such as India, Bangladesh, and Pakistan.

Data from the Asia Gas Tracker, compiled by Global Energy Monitor, shows that the three South Asian countries have about $107 billion worth of LNG terminals and gas pipelines either announced or currently under construction.

Together, these projects represent a major share of global gas infrastructure expansion. Southern Asia accounts for 17% of global LNG import capacity under development—about 110.7 million tonnes per year—and 17% of global gas pipelines by length, totalling 34,146 kilometres, according to the report.

India’s expanding gas infrastructure

India is pursuing one of the largest gas infrastructure expansions in the world. The report notes that the country is developing the second-largest LNG terminal expansion globally and the third-largest gas pipeline buildout.

A chart in the report indicates that India ranks among the top countries worldwide for pipeline construction, with nearly three-quarters of its planned gas pipeline network already under construction.

Meanwhile, Bangladesh and Pakistan each have enough LNG import capacity in development to roughly double their existing capacity, highlighting the scale of the region’s dependence on imported gas.

Price volatility and project risks

Despite projections that global LNG supply could increase later in the decade, the report warns that the market remains highly sensitive to geopolitical disruptions. Even relatively balanced markets can experience price spikes if shipping routes or production are affected.

The ongoing conflict in the Middle East demonstrates how quickly a promising growth market can shift into an affordability crisis, potentially delaying or cancelling major infrastructure projects.

“We’ve seen this story before, and South Asian economies that import LNG will struggle with these price shocks. It’s a reminder of the risks of building new gas infrastructure, and that domestic alternatives like renewable power are more affordable and reliable in the long run..” said Robert Rozansky, global LNG analyst for Global Energy Monitor.

History of cancelled LNG projects

The report also highlights a pattern of stalled or cancelled gas infrastructure projects across the region.

Over the past decade, India, Bangladesh, and Pakistan have shelved or cancelled two to three times more LNG import capacity than they have successfully brought online, reflecting the financial and market risks associated with LNG development.

According to the report, India cancelled or shelved 49 million tonnes per annum of LNG capacity, compared with 23 million tonnes that entered operation between 2016 and 2025. Bangladesh and Pakistan show similar trends.

Renewables gaining ground

At the same time, renewable energy is increasingly competing with natural gas in the region’s power sectors.

Solar generation in Pakistan has more than tripled over the past three years, while India is projected to meet over 40% of its electricity demand with renewable energy by 2030.

The report also notes that improvements in energy storage technologies are enhancing grid flexibility, potentially reducing the role of gas as a backup power source.

Emerging alternatives such as green hydrogen could also help reduce reliance on imported fossil fuels for industrial use in the future.

The Asia Gas Tracker, developed by Global Energy Monitor, is an online database that maps and categorises gas infrastructure across the continent, including pipelines, LNG terminals, gas-fired power plants, and gas fields. The tracker is updated annually and documents projects through detailed data pages.