Heads We Win. Tails They Lose. Don’t Bet on a Long-Run Future for Fossil Fuels.

When oil and gas prices skyrocket and supplies run short, consumers now have a cheaper, steadier alternative. When supplies recover, the glut hits. Either way, it’s sunset time for fossil fuels.

Jun 21, 2026

Photos (l) Abbas Zakeri/All Content by Mehr News Agency is licenced under a Creative Commons Attribution 4.0 International Licence; (r) Facebook

As the details of the ceasefire agreement between the United States and Iran trickled into public view and their implications took shape over the last week, a faster global shift out of fossil fuels emerged as the real winner. Even if it’ll take a little while for those results to come fully into view.

And since oil, gas, and coal account for 75% of the greenhouse gas emissions that are fuelling the climate crisis, producing killer heat waves in India and yet another round of wildfire evacuations in places like Lytton, British Columbia, bad news for the fossil industry is good news for the rest of us. As long as “the rest of us” includes communities and households in Canada and elsewhere that make their living from a dying commodity and quite rightly feel threatened by an unplanned transition that, left to its own devices, might well leave them behind.

In typical, chaotic Trump fashion, the geopolitics of the ceasefire are still shifting by the day, and the drama shows no sign of ending soon. But multiple news reports and analyses are pointing to this deal as a massive geopolitical defeat [video] for the United States and a humiliating surrender for the “sundowning”, self-dealing narcissist who launched his “little excursion” into Iran more than 100 days ago.

What is also emerging is the extent to which the American/Israeli war and the resulting disruptions in the Strait of Hormuz have broken the trust and confidence underpinning the global fossil fuel trade—which accounts for an astonishing 40% of international marine traffic.

Shippers and ship’s captains are quite rightly nervous about a transit through dangerous waters. (I wish my late father-in-law, a master mariner who always put safety first, were here to share what I’m sure would be some colourful colour commentary.) Insurers are understandably hesitant to back the voyages. Best estimates are that it will take weeks or months to clear the mines and other military obstacles in the strait and months, perhaps more than a year, to restore some semblance of normal traffic and supply chains. At last count, both Iran and the U.S. were threatening to charge tolls for access to an international waterway that was previously freely available to all.

The Moment We’ve Been Training For

Last week, Semafor climate and energy editor Tim McDonnell opined that Hormuz “will never really be open again”—and as a result, the shift to renewables is being redoubled, especially in Asia. He cited a survey of 2,000 global executives in which 91% agreed switching from fossil fuels to electricity would improve their companies’ energy security.

The epic turmoil and uncertainty have opened a window of opportunity for clean, low-carbon options that give oil- and gas-importing countries a practical lifeline against an existential threat to their energy security. And a cheaper, quicker, more reliable alternative to the oil and gas exports that the Canadian government and its self-styled “minister for national unity” (ahem), the actual energy and natural resources minister Tim Hodgson, continue to talk up to anyone who’s still listening.

“The countries that succeed will electrify, while diversifying supply chains and investing in resilience,” Meghan O’Sullivan, a former senior U.S. energy security official, told Semafor’s McDonnell. “Energy geopolitics is shifting from barrels and tankers to minerals, grids, batteries, and technology.”

Which is a longabouts but more substantive way of saying this is the moment we’ve been training for all our lives.

“Ships of the World, start your engines,” Trump wrote on his Truthless Social platform last Sunday night, after 106 days of war. “Let the oil flow!” But most of that now-understated revving sound you hear is not the fossil-fuelled behemoths that brought us to this point of climate emergency, energy insecurity, and local price shocks. It’s the smooth electric motors and clean power generators that are racing to replace them, once and for all: with the green economy now hitting a record-high $10 trillion in market value, revenue up $5.5 trillion last year in spite of Trump’s best and worst efforts, and clean energy investment still outpacing fossil by nearly a two-to-one margin.

When Fossil Prices Rise, Alternatives Surge

We don’t hear much in Canada about the accelerating global shift to pretty much any energy source that isn’t oil or gas. We’re a petrostate, through and through, and as Environmental Defence Canada shows in an excellent and exhaustive media backgrounder on fossil fuel messaging, our culture and public narratives reflect the millions upon millions of dollars a mostly U.S.-owned industry has invested to (mis)shape it.

But the changes are happening, even if they’re just beyond our view. The shift was well under way before Trump’s war, with the International Energy Agency (IEA) proclaiming the Age of Electricity and projecting that demand for all three fossil fuels would peak this decade before going into terminal decline. Now, it’s accelerating so fast that there’s a whole new set of linked references to add whenever it’s time to tell or retell the story.

Here are some of the stories we were following earlier in the spring, in the early days of a war that brought a deadly missile attack on 200 children and adults in a girls’ school in Minab, toxic “black rain” to civilians in Tehran, and devastation to fragile ecosystems throughout the Persian Gulf:

• China is already securely positioned as the world’s first electrostate. And the world’s most populous country, India, is moving farther and faster, even though it’s considered to be at an earlier stage in its economic development.

• Pakistan, facing a “perfect storm” of liquefied natural gas (LNG) price and supply shocks after Russia invaded Ukraine in 2022, saw its power grid transform from negligible solar power to an expected 20% of all its electricity coming from rooftop panels by this year. “The Strait of Hormuz is a fossil fuel tinderbox, but Pakistan is busy winning the real war,” Gurin Energy CEO Assaad Razzouk wrote on LinkedIn, with “50 GW of solar imported so far by the people—not the bureaucrats. That’s $120 billion in fuel costs saved over the panels’ life,” amounting to “energy independence from the bottom up.”

• In Vietnam, the Vingroup industrial conglomerate sought the government’s permission to replace a 4.8-gigawatt liquefied natural gas plant, the country’s biggest, with renewable energy. “In addition to cost factors, dependence on imported fuel also poses considerable challenges to energy security, supply autonomy, and Vietnam’s ability to control electricity generation costs,” Vingroup said.

• Indonesia President Prabowo Subianto pledged to increase his country’s solar+storage capacity from 11 to 100 GW in just two years. “This is a wake-up call,” he said. “We will convert all motorcycles into electric motorcycles. All cars, all trucks, all tractors must (also) be electric.”

More recently:

• The European Union is looking at energy security options that bypass Hormuz, The Associated Press reports. One option is an economic corridor from India that would offer the continent “greater economic resilience, supply chain diversification, and energy security to bolster the bloc’s strategic autonomy.” The plan “could involve new pipelines and transmission cables,” AP writes, but an official said the EU would also “encourage European companies to invest in renewable energy projects in the Gulf to supply the EU’s energy demand.”

• German environment minister Carsten Schneider is calling the war a wake-up call to accelerate the fossil fuel phaseout during COP31 negotiations in Türkiye later this year, our friends at Clean Energy Wire report, though the fraught outcome of mid-year negotiations in Bonn over the last couple of weeks may not bode well.

• In Asia, solar has overtaken fossil gas as a power source for the first time, Carbon Brief reported earlier this month, with annual output in countries like China, India, and Pakistan increasing nearly four-fold since 2020.

• Solar installations in Africa may be moving four times faster than official data suggest, “with huge consequences for the continent,” energy transition advisor Gavin Mooney wrote on LinkedIn, citing analysis in PV Magazine. “Analysis of solar panel imports from China suggests the reality could be up to four times higher,” and as in Pakistan’s rooftop solar boom, “much of this growth is taking place outside traditional energy planning processes,” he writes. “That’s because the boom isn’t being driven by large state-backed solar parks. It’s happening on thousands of rooftops across the continent—factories, shopping centres, hotels, warehouses, and residential buildings.”

• Gas usage has peaked and gone into decline in Australia.

• South Korea is working to cut its utility costs in half by adding 100 gigawatts of new renewable energy by 2030.

• An Australian company operating in the Philippines decided to abandon a long-delayed LNG-fuelled power plant and sell its gas turbine to a company in the U.S.

As Prices Fall, the Glut Returns

So if that’s what happens when oil prices go through the roof, or threaten to, you might think a round of price relief would give fossil producers some aid and comfort. Guess again.

The Hormuz crisis drove up prices, bringing $30 million per hour in windfall profits to the global industry, and looked likely to push prices further. That’s because the narrow, now contested strait is the chokepoint for about 20% of the world’s oil and gas shipments, not to mention essential supplies of fertilizer. The early days of the war also saw Iran launch missile and drone attacks on at least one oil refinery in Saudi Arabia and liquefied natural gas (LNG) facilities in Qatar, prompting Qatar to take all its production off the market.

But with tensions at least temporarily ratcheting down, the pre-war oil and gas glut that one analyst called a “sinkhole” for future LNG sales is set to return, maybe sooner than the fossil industry and its boosters want you to think. The IEA says a new oil glut could produce a “significant overhang” between supply and demand as early as next year. And LNG, Canada’s new favourite export fantasy, could be following right behind. Here’s Sam Reynolds, research lead for Asia with the Institute for Energy Economics and Financial Analysis, in an interview with The Energy Mix earlier this month:

I’m not optimistic that LNG demand will completely evaporate over the next two decades, but it depends on what price…
We’re headed into a global glut of LNG. You have record amounts of supply coming online. That glut has been postponed a little by the Iran conflict. But ultimately there may be so much supply, and demand only at prices of $3 to $5 per unit…
At that price, there is no profitability guaranteed for the resellers of LNG.

The existential problem for oil and gas is a set of energy sources that are cleaner, cheaper, faster to deploy, and pretty much immune to price volatility and geopolitical shocks—because rather than requiring a constant supply of fuel, clean energy is a one-and-done. Once you’ve installed your solar panels or wind farm, your heat pump or your batts of insulation, there’s no need to go back for resupply for another 20, 30, 40 years, or more. As Michael Liebreich, founder of the analytics firm that eventually became Bloomberg New Energy Finance (BNEF), told The Mix earlier this year:

Look at China. Look at India. Look at the importers, the energy-hungry around the world, and what makes sense for them to buy or to build for themselves. If you look at the economics, for every million dollars you have to spend on energy, build the asset. Don’t burn the commodity.

What’s Left for Canada’s Fossil Communicators: Spin a Good Yarn

None of this suggests a reliable market for Canadian oil and gas exports over the 20 or 30 years that it will take to get new projects like Ksi Lisims LNG or the proposed West Coast pipeline financed, approved, and built, then run them long enough and at high enough prices to bring investors the profits they were promised.

So what do you do when the facts don’t back your narrative? You spin a good yarn, spin it like mad, and if you’re a national leader with the clout and connections of Prime Minister Mark Carney, you mobilize the G7 to back the fading myth that Canada can “deliver significant additional capacity” to help stabilize global oil and gas markets.

That was Natural Resource Minister Hodgson’s pitch in a recent op ed for the Financial Post:

Everywhere I go, I hear the same thing: Canada has what the world needs.
We have energy. We have critical minerals. We have forests. We have unparalleled civilian nuclear expertise. We have one of the world’s most skilled workforces; institutions that are the envy of the world; and world-class environmental standards [and again I say, ahem—Ed.]. Finally, we have geographic good fortune, with access to global markets via three oceans.
But if Canada wants to emerge from this crisis stronger, simply having these advantages is not enough. Team Canada must pull together and put our differences aside to ensure we can come out of this time of volatility and uncertainty more prosperous, resilient and sovereign.
That is why, as your Minister of Energy and Natural Resources, I have come to see my role in another way, too—as a kind of “minister of national unity.”

As a measure of how aligned Hodgson might be (or not) with the PM’s former musings, organizing efforts, and UN activities, it’s curious to see that our “minister of national unity” had nothing to say about the nation-building projects that can bring the nation together rather than driving us apart—what the #ElbowsUp for Climate campaign calls “nation-building, not nation-burning projects”. The words “clean”, “renewable”, “solar”, “wind”, and “efficiency” showed up not once in his Financial Post pitch.

Which means the climate and energy community as a whole—from campaigners to business executives to sustainable finance pros—has a long way to go to solidify the kind of practical, achievable, and low-carbon strategies that #ElbowsUp put forward during the last federal election, and has been promoting ever since:

• A national clean energy grid;

• Building two million energy-efficient, non-market homes;

• Energy retrofits for low-income homes and multi-unit buildings;

• A national high-speed rail and intercity bus system;

• Actual funding for a “national resilience, response, and recovery strategy,” which we’ve only been hearing about for half of forever but still hasn’t happened.

The danger in the industry spin we’re hearing from Hodgson and others, and that Environmental Defence has documented so meticulously and damningly, is that it slows down mainstream understanding that the energy transition isn’t just on the way. It’s unfolding before our eyes and promises massive, low-carbon economic opportunities for every Canadian community, from coast to coast to coast.

That understanding, in turn, goes to the core of what veteran climate communicator Katharine Hayhoe calls “efficacy”—an overwhelming percentage of us know that climate change is happening and want our governments to do something about it, even if we often don’t realize we’re in the majority, but the message hasn’t yet landed widely enough that there’s something comprehensive that we can do.

That’s why getting the story straight is such an important part of getting the work done. It starts with everyone understanding, and our political leaders admitting, that the fossil fuel economy as we knew it is gone, never to return.

Mitchell Beer traces his background in renewable energy and energy efficiency back to 1977, in climate change to 1997. Now he and the rest of the Energy Mix team scan 1,200 news headlines a week to pull together The Energy Mix and The Energy Mix Weekender.