Will Iran War Drive Decarbonisation?

What is the probability of countries exposed to oil imports accelerating their energy transitions?

I’ll answer this as a scenario probability: not “will they become green overnight,” but whether the shock materially accelerates policy, procurement, and investment decisions beyond the pre-crisis trend.

My probability estimate of a material acceleration in energy transition policy or investment over next 12–24 months if the Strait if Hormuz seems set to remain closed to international commercial shipping:

South Korea 70–85%

Already heavily invested in renewables, nuclear, grid/storage, industrial electrification & efficiency, aiming for reduced LNG/oil exposure.

UK 70–85%

Faster clean power, grid approvals, EVs, heat pumps, offshore wind, nuclear/SMRs, energy efficiency - if the current government can remain in power.

EU 75–90%

Already moving: clean energy framed explicitly as resilience against volatile fossil-fuel imports.

Japan 55–70%

Nuclear restarts, efficiency, LNG diversification, hydrogen/ammonia, selective renewables; less radical on road fuels.

Australia 50–70% EVs, charging, biofuels, fuel-security reserves, domestic refining support, renewables; not simply “green” acceleration.

Import-dependent emerging economies 40–65% Efficiency, solar, electrified public transport, fuel subsidies reform where politically possible.

My broad answer is: around 70% probability that this crisis accelerates the energy transition among oil-import-exposed rich countries, and probably higher in Europe/South Korea than in Japan/Australia.

The reason is that the language of transition has changed. It is no longer just climate; it is now national security, trade balance, inflation control and industrial resilience. The European Commission’s recent “AccelerateEU” package explicitly links volatile fossil-fuel markets and the Middle East conflict to accelerating homegrown clean energy and reducing oil and gas imports. The UK government has made a similar argument, saying the lesson of the second fossil-fuel shock in less than five years is that “the era of fossil fuel security is over” and that clean energy security must come of age.

But “energy transition” will mean different things in different countries. In South Korea, I expect both green and non-green acceleration: more renewables and grid/storage, but also more nuclear and possibly temporary coal use to reduce LNG vulnerability. One Korean report says the government has already increased coal and nuclear generation to ease LNG supply concerns during the Middle East crisis. That is not decarbonisation in the short term, but it is an energy-security response that could still accelerate longer-term diversification away from imported oil and gas.

In Japan, the acceleration is likely to be real but conservative. Japan imports about 90% of its energy requirements, and recent data show nuclear restarts continuing, including Kashiwazaki-Kariwa Unit 6 in February 2026; Japan’s long-term policy would require up to 30 reactors operating to reach roughly 20% nuclear power by fiscal 2040. But Japan will also double down on “secure molecules”: LNG, hydrogen, ammonia and strategic partnerships with Australia. The recent Australia-Japan statement is framed around keeping energy goods flowing and shielding consumers from global uncertainty.

Australia is the awkward case. It may accelerate EVs, charging, biofuels and renewables, but the immediate response is also likely to include more old-fashioned fuel security: domestic refining support, fuel reserves and emergency diesel procurement. The Australian government’s May 2026 fuel-resilience package includes support for the last two refineries, feasibility work for expanded domestic refining, EV tax support and fast kerbside charging.   That is a transition-plus-resilience package, not a straight fossil-exit package.

For the UK, I’d expect the crisis to strengthen the political hand of clean power advocates. The Clean Power 2030 agenda was already in place, but recent government statements emphasise going “further and faster” on energy security, offshore wind procurement and clean-energy investor certainty.   The UK’s vulnerability is less crude imports than the broader problem of globally priced fossil fuels feeding into electricity, transport, heating and inflation. That makes electrification, grid buildout, heat pumps and EVs easier to sell politically as anti-volatility tools rather than just climate tools. The UK’s veesion of the EU ETS for shipping comes into force on 1 July, with an aim of driving fleet renewal to low-emission vessels for UK trading.

The wrinkle is that oil shocks can also produce a fossil-security backlash. Japan’s Idemitsu has reportedly shifted back toward fossil fuels in its medium-term plan, reflecting stronger returns and security concerns. Australia is supporting domestic refining. South Korea is using more coal and nuclear in the short run. So the crisis probably accelerates both clean energy and “secure fossil fallback” investment.

Overall, there is a 70–80% chance that import-dependent advanced economies accelerate the energy transition after this shock, but the first wave will look less like idealistic decarbonisation and more like hard-headed energy-security policy: electrify what can be electrified, restart nuclear where politically possible, build reserves, protect refineries, diversify LNG, and reduce oil exposure in transport. The good news for renewable fuel enthusiasts is that energy security has become the transition’s new sales department.