🌍 Crude Oil Instability Renews Debate on Energy Strategy

17th June 2025   Volatility in global oil markets has once again come into sharp focus as geopolitical tensions escalate in the Middle East. Crude prices have surged following recent Israeli strikes on Iranian facilities, pushing Brent close to the USD 80 mark—a level widely considered a threshold at which previously uneconomic sources of oil, such as shale and fracked reserves, start to re-enter the conversation. This development comes amid continued energy disruption caused by the war in Ukraine and increasingly fractured relations with Russia. As supply chains are tested and markets jitter, the conversation around energy resilience, security, and strategy is growing ever more urgent. At Gapuma, we remain mindful of the complex and often polarising nature of energy policy, particularly where fossil fuels such as fracked oil and gas are concerned. While fracking remains a subject of intense debate—on environmental, regulatory, and social grounds—what is undeniable is that rising oil prices tend to breathe new life into its economic case. At price points above USD 80 per barrel, advocates of fracking are likely to become more vocal, and investment interest could follow. However, it is essential to situate this debate within a broader strategic context. Short-term responses to supply shocks must not overshadow the longer-term imperative to create a more balanced and sustainable energy mix. Carbon-based fuels—while still an important part of global supply—must gradually yield to lower-emission alternatives that offer both environmental and geopolitical stability. Battery technologies, scalable renewables, green hydrogen, and smart grid infrastructure will all play increasingly pivotal roles in shaping the energy systems of tomorrow. These technologies reduce dependency on volatile imports, enhance domestic energy security, and contribute meaningfully to decarbonisation targets. As political analyst Marwan Bishara noted, “Energy has become the lifeblood of geopolitical power—a single disruption can reshape global alliances.” That reality has been laid bare in both Eastern Europe and the Gulf, and it continues to shape decision-making across boardrooms and governments alike. Reflecting on this moment, Jack Bardakjian, Gapuma’s Group Managing Director, said: “We need to be very judicious in the choices we make today to guarantee our energy security in the medium to longer term.” With the situation in Iran remaining fluid and the risk of further destabilisation high, the pressure on energy markets is likely to persist. Should a leadership vacuum emerge or regional conflict escalate, we could see further strain on oil flows and a renewed push by certain sectors for domestic energy sources, including shale and fracked hydrocarbons. Nonetheless, the long-term trajectory must point toward a healthier, more diversified global energy portfolio—one in which carbon-based fuels represent a smaller share and sustainability plays a greater role in both energy policy and investment decisions. Gapuma remains committed to providing insight and clarity at this critical junction, as markets, policymakers, and partners navigate the path ahead.