The war in Iran is expected to accelerate the global energy transition by strengthening the shift towards renewables, batteries and nuclear, according to DNV.
DNV said in a research note that the conflict has created the largest oil and gas supply shock in decades, pushing countries to reduce dependence on fossil fuel imports.
The certification outfit believes that elevated oil and gas prices are likely to persist due to disrupted supply and slow recovery of infrastructure and trust.
DNV noted that Iran’s closure of the Strait of Hormuz has severely constrained global energy flows, with around 20% of oil and gas shipments typically passing through the route.
“Without knowing the duration and possible escalation of the conflict, it is clear that restoring production will take time; restoring trust even longer.”
It said the disruption disproportionately affects Asia but will impact all energy-importing countries, increasing motivation to diversify energy systems.
Higher energy prices and security concerns will ultimately strengthen demand for renewables, nuclear and energy efficiency despite higher capital costs.
The organisation said more than 40 critical energy infrastructure facilities have already been damaged, with some expected to take years to repair.
Global markets are facing inflationary pressure, disrupted shipping routes and rising fuel and insurance costs as a result of the conflict.
“The rule-of-thumb that what is bad for fossils is good for renewables applies.”
It added that energy security policies tend to favour renewables deployment, with recent market movements indicating increased investor focus on batteries and electrification.
The long-term effect of the crisis is likely to reinforce decarbonisation, even though the transition will require sustained investment and time.