The EU's 2022 energy crisis, triggered by Russia's invasion of Ukraine, exposed the dangers of over-reliance on Russian gas. By early 2026, markets had stabilized as Asia secured long-term LNG contracts and Africa diversified sourcing. However, the US-Israel strike on Iran in February 2026 and the closure of the Strait of Hormuz—responsible for 20% of seaborne gas and 25% of oil—disrupted global supply, causing cumulative losses of 1.3 billion barrels by June.
Attacks on Qatar's LNG infrastructure further spiked gas prices, forcing importers to rethink long-term strategies. The International Energy Agency reports global energy investment will reach $3.4 trillion in 2026, with $2.2 trillion directed toward grids, renewables, and storage. Oil investment is projected to fall below $500 billion, while gas and renewables rise by $330 billion and $665 billion respectively.
In the short term, Japan, South Korea, Italy, and Germany have increased coal usage, utilizing previously underused plants. The first half of 2026 saw the slowest coal plant retirements since 2015, with only 4.9 gigawatts decommissioned. Despite this, the transition toward non-fossil fuels continues as energy security becomes paramount.
Source: Financial Times Companies · Summarized by HeadlinesBriefing