Iran War Accelerates Energy Order Shift, With China Emerging as the Winner

Experts suggest that China, which dominates the global renewable energy supply chain, may be the biggest winner of the war between the United States and Iran as it draws to a close.

The New York Times (NYT) reported on June 16 (local time) that the war has ignited a race to secure alternative energy sources, predicting that China will reap the benefits of this energy transition.

The war has served as a catalyst for exposing the vulnerabilities of the Middle East-based fossil fuel supply chain in the global energy market.

As Iran blockaded the Strait of Hormuz and bombed energy facilities in Gulf states, the global economy faced unprecedented energy supply shortages and price spikes.

The growth projections that pointed toward a rapid expansion before the war broke out early this year have vanished, replaced by the reality of low growth and high inflation.

In particular, the NYT pointed out that the global energy order is being irreversibly reshaped due to the international community's response to avoid the risks associated with the Middle East war.

This means that energy-producing nations are competing to maintain or expand their dominance, while consuming nations are struggling to reduce their dependence on Middle Eastern energy.

The NYT noted that this trend will lead to changes in the "energy mix" (the composition of energy sources consumed) of various countries and shift the key players in the energy market.

The explanation is that Asian and European countries, shaken by the conflict, are highly likely to accelerate their transition to renewable energy and nuclear power in the long term, alongside their search for alternative energy sources.

Dave Jones, a researcher at the British energy think tank Ember, highlighted the environment that makes energy transition easier, thanks to advancements in electric battery technology and improved efficiency.

"This is a massive turning point," he said. "Things that were barely competitive (in price) five years ago are now almost certainly cheaper."

The NYT analyzed that China is emerging as the biggest beneficiary of this energy transition period, which was triggered by the war between the U.S. and Iran.

The argument is that China is the best-prepared nation to act as an all-encompassing supplier in the long-term trend of restructuring and diversifying energy networks that will persist even after the war ends.

China leads the world in wind turbines, solar panels, batteries, transformers, high-voltage cables, and related software.

As a result, the conditions are ripe for China to increase its strategic influence while expanding its role in ensuring a stable energy supply.

Wood Mackenzie, a global energy think tank, concluded that "China is seen as the clear winner."

In the context of the global hegemony struggle with the U.S., some observe that this war could be a significant boon for China.

The argument is that the U.S., which had been pushing to keep China in check during the supply chain battle, has fallen into a self-contradictory position due to the trend of global energy market restructuring.

U.S. President Donald Trump is pushing policies to revive the fossil fuel industry, even going so far as to block renewable energy projects within the U.S.

Because of this, the U.S. has effectively withdrawn from the global competition over alternative energy, finding itself in a position where it is handing over industrial and technological advantages to China.

The NYT pointed out, "Economic advantages are often reinforced by geopolitical ones," adding, "Because of this war, the U.S. has seen its conflicts with long-time allies in Europe deepen, and as a result, China has gained an opportunity to expand its role in leading the international community."
※ Please note: This article was translated by AI and may contain errors.