The disruption of energy flows through the Strait of Hormuz is accelerating two investment strategies. Countries dependent on imported oil and gas are moving faster into renewables, electrification and storage, while hydrocarbon exporters are investing to protect production and create alternative routes to global markets. The result could be a deeper structural divide between countries trying to reduce fossil dependence and those seeking to preserve the value of fossil exports.
According to DNV’s Energy Transition Outlook 2026, the share of non-fossil energy in the primary energy mix of importing regions increased by 2.2 percentage points over the past five years, compared with 0.7 percentage points in exporting regions. China, India and Europe have therefore shifted towards non-fossil energy more than three times as fast as the Middle East, North America and Russia.
The Iran crisis is turning energy security into transition policy
The immediate effect is painful for importing economies. Energy prices are higher, governments face pressure to protect consumers and companies, and energy-intensive industries absorb another competitiveness shock. DNV estimates that energy prices are around 25% above pre-Iran-war levels, with importers facing the stronger economic headwinds.
But the same shock strengthens the case for reducing exposure to imported fuels. Solar, wind, batteries, grids and electric vehicles are increasingly treated as energy-security infrastructure, not only climate solutions. DNV’s policy analysis makes the point directly: wind and solar do not depend on maritime chokepoints such as Hormuz.
DNV’s sensitivity analysis suggests that if the Middle East conflict continues until 2030 and oil and gas prices remain moderately elevated, global demand for the two fuels would be 4-6% lower while the conflict persists. Demand would then remain 2-5% below the main forecast, suggesting that part of the demand destroyed by the crisis would never return.
Exporters are building resilience around the fossil system
Hydrocarbon exporters face a different problem. Their immediate incentive is to preserve production, market access and revenues. Producers outside the disrupted area can raise output to compensate for shortages, while Gulf exporters are investing in logistics that reduce exposure to Hormuz.
DNV’s Middle East and North Africa outlook says Saudi Arabia and the United Arab Emirates are accelerating bypass routes for oil exports. The UAE is fast-tracking a second West-East pipeline to Fujairah, while Saudi Arabia already has the East-West pipeline system connecting producing areas with the Red Sea. Importers respond by reducing fossil demand; exporters by making supply more resilient.
The strategies can coexist in the short term, but they point in opposite directions. Importing economies are putting capital into technologies that reduce the need for traded hydrocarbons. Exporters are putting capital into infrastructure that protects their ability to sell them. DNV now expects the Middle East to provide around 40% of global oil production in 2050, down from 50% in its 2025 outlook
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The larger risk for exporters is loss of leverage, not only revenue
In the short term, importers carry much of the pain through higher prices, inflation, fiscal support measures and pressure on industry. One can see how exporters can benefit from scarcity and stronger bargaining power, provided they can keep oil and gas moving to market.
Over the medium and long term, repeated supply shocks can undermine the source of that leverage. If Europe, China, India and other importing markets respond by electrifying transport, expanding domestic renewables and storage, and reducing oil and gas intensity, future fossil demand becomes structurally weaker. DNV already describes the Iran war as a driver of permanent demand destruction and forecasts oil’s long-term decline despite the current shock.
The strategic exposure extends beyond the Gulf. Iran, the United States, Russia and Venezuela differ profoundly in market position and political circumstances, but all depend to different degrees on the economic value of hydrocarbon exports. A world in which importing countries need less imported oil and gas means not only lower potential revenues, but also less geopolitical influence attached to controlling those supplies.
The Iran crisis may therefore accelerate both sides of the transition. Importers are investing to escape fossil-fuel insecurity. Exporters are investing to defend access to fossil markets. The first strategy reduces future dependence; the second protects an existing business model. If DNV’s forecast is right, the gap between the two will continue to widen.
