IEA head says geopolitical shocks will boost coal use

Fatih Birol, head of the International Energy Agency (IEA), stated at the ONS Conference in Stavanger, Norway, that geopolitical turbulence is likely to provide a boost to coal usage. Birol noted that governments are increasingly prioritizing energy supply reliability over cost due to market disruptions.

Following the conflict involving the United States, Israel, and Iran that began on February 28, oil prices have surged above US$100 per barrel multiple times. This volatility has driven up global petrol and diesel prices. Birol compared the impact of Iran’s closure of the Strait to a ‘broken vase,’ suggesting that while energy may still flow from the Middle East, the previous market stability is unlikely to return easily.

While Birol identified renewables as a major long-term winner and noted a potential comeback for nuclear energy, he emphasized that non-exporting countries are looking toward domestic production, including coal, to ensure energy security in the short term.