Strait of Hormuz Closure Prompts Shift Toward Domestic Energy Capacity

The Strait of Hormuz closed in early March, cutting off roughly a fifth of global oil and liquefied natural gas supplies. Several governments responded with emergency measures including fuel rationing and suspension of levies. The Philippines declared a national energy emergency on March 24.

Zambia suspended fuel levies for three months at a cost of $100 million to its government. Slovenia began rationing fuel.

Countries that rely heavily on imported fuel have faced limits on their diplomatic options. Several governments negotiated directly with Tehran for tanker passage rather than taking stronger public positions. Pakistan increased its share of solar power from under three percent in 2020 to over 32 percent by the end of 2025.

A recent analysis estimated that this expansion avoided more than $12 billion in oil and gas imports since 2020.

Spain generates over 56 percent of its electricity from renewables. U.S. military bases on its territory to be used for operations against Iran. U.S. officials and brokered the April 8 cease-fire. Pakistani Prime Minister Shehbaz Sharif and Field Marshal Asim Munir participated in the talks.

The article states that governments are shifting toward building domestic energy capacity, with China positioned as the leading supplier of renewable technology.