The Iran war is jolting global energy markets and, in the process, strengthening China’s position in clean technologies and renewable power. With the Strait of Hormuz now mostly shut, most of the oil and gas that moved through it was Asia-bound, leaving Asian nations scrambling to conserve energy and shore up dwindling reserves while gasoline prices in the U.S. and Europe spike. The disruption is hitting most of Asia hard, but China is expected to come out ahead despite being the biggest purchaser of Iranian oil.
Who Pays for the Disruption
The immediate burden is falling on ordinary people and energy-dependent countries, not on the corporate giants and state planners shaping the system from above. As fossil fuel supplies wobble, the article says global energy disruptions are accelerating a shift toward clean technologies and renewable power, industries that China dominates. China leads the world in battery, solar and electric vehicle exports, and its industries are forecast to face rising demand for renewable products as the crisis deepens.
Before the Iran war began in late February, China’s lead in clean technologies was already lengthening. At the same time, the U.S. under President Donald Trump scaled back renewable energy and leaned on its vast oil and gas resources, promoting energy exports to achieve what Trump described as “energy dominance.” The result is a stark split in energy futures, with one superpower doubling down on fossil fuels while the other is positioned to profit from the instability those fuels create.
The Clean-Tech Winners
Chinese industry giants like vehicle-maker BYD and battery-producer CATL are now well-positioned to capitalize on growing interest in low-emissions energy products as the world confronts the fragility of fossil fuels. Sam Reynolds with the U.S.-based Institute for Energy Economics and Financial Analysis said, “China’s approach to energy sector development and geopolitics has been completely validated by the Iran conflict.”
Reynolds also said markets were witnessing a “bifurcation” before the war, with the superpowers pushing very different energy futures and leaving other countries with complex choices on which approach to back. That split is now being sharpened by the war itself. The Iran conflict is driving demand for Chinese technology, whose exports of items such as solar panels, batteries and electric cars hit a record of almost $22.3 billion in December. That was up about 47% from the year before, with much going to Southeast Asia and Europe, according to the think tank Ember.
Investment in renewable power and battery storage — designed to save energy when the sun isn’t shining or the wind isn’t blowing — is expected to increase in nations heavily dependent on energy imports, including European countries, according to the credit rating firm Fitch Ratings. Investors are already betting the war will boost demand for renewables. In March, CATL and BYD’s Hong Kong traded shares rose roughly 24% and 11%, respectively.
Households, Imports, and the New Energy Scramble
The hierarchy cost shows up most clearly in the households facing higher energy bills and the countries forced to scramble for alternatives. James Bowen of the Australia-based consultancy ReMap Research said households facing higher energy costs are likely to move to clean power. Pakistan offers an early example. Its renewable rollout in 2017 led to more than 50 gigawatts of Chinese solar panels imported by December 2025. Pakistan still imports a third of its energy. About 80% of its oil flowed through the Strait of Hormuz, and Qatar had been supplying a quarter of its LNG.
Nabiya Imran of Renewables First said, “the shock isn’t as big as it would have been without solar.” If prices remain high, solar could save Pakistan $6.3 billion in fossil fuel imports over the next year, according to think tanks Renewables First and the Centre for Research on Energy and Clean Air. The numbers show how energy insecurity is pushing countries and households toward whatever alternatives are available, even as the benefits are captured by the firms and states already positioned to supply them.
In the United Kingdom, EV leasing demand jumped by more than a third in the first three weeks of March compared to a similar period in February before the war, according to Octopus Energy, a renewable group. Octopus also reported increases in rooftop solar sales and solar-related inquiries. In Southeast Asia, Vietnamese EV maker VinFast is offering discounts to offset fuel price shocks. Patrick Tan, with the energy consultancy Aurora Research, said prolonged fuel spikes may act as a future catalyst for EVs, but it will take time to see the trend reflected in purchases, partly because customers are likely waiting to see how the conflict plays out.
Even Indonesia, the world’s largest coal exporter, is recalibrating in ways that could make it a bigger customer for China’s clean energy technology. In March, Indonesian President Prabowo Subianto announced a push into EVs, including plans to produce electric cars and expand charging infrastructure. Putra Adhiguna of the Jakarta-based think tank Energy Shift Institute said, “The dream of electrified transportation is gaining renewed attention.” Chinese firms play a major role in Indonesia’s clean energy supply chain. They signed more than $54 billion dollars’ worth of deals with the state utility in 2023 and added a $10 billion pledge during Prabowo’s visit to Beijing in 2024. Reynolds said, “There will be direct financial benefits to Chinese companies.”
The article was written by Chan Ho-Him, Aniruddha Ghosal and Anton L. Delgado. Ghosal reported from Hanoi, Vietnam. Delgado reported from Bangkok. AP Business Writer Paul Wiseman contributed to the report. The Associated Press said its climate and environmental coverage receives financial support from multiple private foundations and that AP is solely responsible for all content.