Sign In or Create an Account.

By continuing, you agree to the Terms of Service and acknowledge our Privacy Policy

Podcast

Why the Iran War Is a Warning for Natural Gas

In this special edition of Shift Key, Rob talks to Eurasia Group’s Gregory Brew about how the U.S.-Israeli-led conflict will reshape global energy markets.

Donald Trump et al.
Heatmap Illustration/Getty Images

The United States and Israel have launched a devastating new war on Iran. What has happened so far, when could it end, and what could it mean for oil, gas, and the global energy shift?

Rob is joined by Gregory Brew, an analyst with the Eurasia Group’s energy, climate, and resources team focused on the geopolitics of oil and gas. He serves as the group’s country analyst for Iran. He’s also an historian of modern Iran, oil, and U.S. foreign policy, and the author of two books about the subject.

Shift Key is hosted by Robinson Meyer, the founding executive editor of Heatmap News.

Subscribe to “Shift Key” and find this episode on Apple Podcasts, Spotify, Amazon, or wherever you get your podcasts.

You can also add the show’s RSS feed to your podcast app to follow us directly.

Here is an excerpt from their conversation:

Robinson Meyer: I think the first place that people’s minds go when you’re talking about Iran, when you’re talking about the Strait of Hormuz, is oil. Why is the Strait of Hormuz particularly important to the global oil market? And then second of all, what have we seen as the initial effects here?

Gregory Brew: So the Strait of Hormuz matters for three reasons. One, it is a very narrow waterway. So it is quite easy, theoretically, to block it. Other waterways — even the Bab el-Mandab and the Red Sea, the Strait of Malacca, other strategic pathways through which large quantities of energy move — are not so easily disrupted as the Strait of Hormuz. That’s reason number one.

Reason number two, Iran. Iran is there. Iran frequently threatens to block the Strait of Hormuz, frequently threatens to close the Strait of Hormuz. It is a hostile actor vis-à-vis the other states in the region. We are now seeing proof of that, given that it is open fire on the GCC in a concerted way. That’s another reason why the Strait of Hormuz gets so much attention as far as the connection between the strait, the strait security and the situation in the global oil market.

The third reason — I guess there are four reasons. The third reason is the volume of energy moving through the strait. It’s close to a fifth of global oil supply. It’s 20 million barrels a day, sometimes a little more. It’s a significant portion of the global LNG supply coming from Qatar has to pass through the Strait of Hormuz. A large quantity of refined products, metal distillates, condensates, fuel oil moves through the strait. So the volume affected by the strait being closed or disrupted or affected in some way is very, very large.

Finally, fourth point, there’s nowhere else to go. You can’t go around the Strait of Hormuz. You have to go through it. Tankers that can’t transit the strait or are blocked from doing so have no other options. There’s no Africa route, as there was with the Red Sea disruption. So for those four reasons, the Strait of Hormuz gets a lot of attention. And it’s why it’s getting attention now. Although, interestingly enough, price of oil has responded, but has not moved so in a significant way, at least per some people’s expectations.

Meyer: Well, the theme of the year in oil so far has been that there’s a glut of oil. Or there’s at least a small glut of oil. We’ve kind of been dealing with that for a long time. And so I wonder if that is in some way — one hesitates to call this good for oil markets, but it is kind of solving an issue for the market. Do you think oil is the most important energy product affected by this war?

Brew: Well, it’s certainly the largest in terms of volume, given how much oil moves through the strait. However, I think this could end up being a gas story as much as an oil story.

You can find a full transcript of the episode here.

Mentioned:

From Heatmap: War With Iran Isn’t Just an Oil Story

From Heatmap: How Trump’s War Could Destabilize the Global Energy Market

This episode of Shift Key is sponsored by …

Accelerate your clean energy career with Yale’s online certificate programs. Explore the 10-month Financing and Deploying Clean Energy program or the 5-month Clean and Equitable Energy Development program. Use referral code HeatMap26 and get your application in by the priority deadline for $500 off tuition to one of Yale’s online certificate programs in clean energy. Learn more at cbey.yale.edu/online-learning-opportunities.

Music for Shift Key is by Adam Kromelow.

You’re out of free articles.

Celebrate the Fourth of July with us and save 20% off an annual subscription, now just $99 $79/year with code: FIREWORKS
To continue reading
Create a free account or sign in to unlock more free articles.
or
Please enter an email address
By continuing, you agree to the Terms of Service and acknowledge our Privacy Policy
Spotlight

Trump Taps Nashville Legend to Fight Solar and Wind Farms

And data centers might be collateral damage.

Farmland.
Simon Abranowicz | Getty Images | Unsplash

After derailing gigawatts of renewable power with a permitting freeze, the Trump administration is expanding its war on renewable energy, retaining one of country music’s biggest stars in a PR offensive against utility-scale projects on “prime farmland.”

The administration recently onboarded John Rich – one half of the stadium-packing American musical duo Big & Rich – to be Trump’s “special envoy for American landowners.” Rich entered activism around landowner rights last January when he backed opponents fighting a large Tennessee Valley Authority transmission project routed through his home county of Cheatham, Tennessee. This led to him joining the Trump team, where he’s fashioning himself as a go-to guy and cheerleader for anyone who wants Trump to help stop a solar or wind farm they don’t want built.

Keep reading...Show less
Hotspots

Data Centers Are the Election Year Villain

And more of the week’s top news around project fights.

Data Centers Are the Election Year Villain
Heatmap Illustration

1. Kansas City, Missouri – Data centers are so toxic that politicians are using them as boogeymen in totally unrelated policy discussions.

  • All week I’ve been thinking about Missouri, where a widely-screened TV campaign ad is airing screeds against AI hyperscale projects to sell a constitutional amendment initiative up for a vote in this year’s November elections. “That hum is the sound of Big Tech making money on online gambling, for porn,” says a nameless man in the ad. “Amendment 5 makes Big Tech pay so you don’t have to. Yes on Amendment 5.”
  • What does Amendment 5 do? Based on the ad, you would think it was focused on tax exemptions for data centers. But no – a yes vote supports cutting the state income tax, a proposal backed by Republican Gov. Mike Kehoe.
  • The ad is misinformation and a mind-blowing use of a confusing conversation around tech infrastructure most were unfamiliar with before this year. Per reporting by the Missouri Independent, the state’s existing tax exemptions for data centers would stay in place if the amendment was adopted.
  • My gut tells me this is only the beginning of the data center industry’s transformation into an election year villain.

2. Ingham County, Michigan – We have our first major anti-data center candidate in a Democratic congressional primary.

Keep reading...Show less
Q&A

Why Data Center NDAs Are a Big Mistake

A conversation with Grant Gutierrez of Carbon Direct

Why Data Center NDAs Are a Big Mistake
Heatmap Illustration

This week’s conversation is with Grant Gutierrez, head of community impacts at carbon management company Carbon Direct. This week Carbon Direct published a white paper Gutierrez authored on opposition around data centers he’s studied. His research reinforces much of what Heatmap Pro has uncovered, but I was particularly intrigued by a topline finding – that transparency is the most common thread in the 46 data center fights he looked into. Was he seeing what I’ve been seeing? So I asked him to hop onto a Zoom call and let me know his thoughts.

The following conversation was lightly edited for clarity.

Keep reading...Show less