Bruce Saller, ADVANCE CONTRIBUTOR
The wars in Ukraine and Iran are causing major disruptions to the supplies of oil and natural gas. Economic sanctions against Russia have forced many countries to replace cheap imported Russian gas with more expensive liquefied natural gas, mainly shipped from the U.S. The Iran war has reduced the amount of oil on the world market, causing the price to increase dramatically. These conditions have benefited the U.S. oil and gas industries, but the gains may be temporary. Countries which import large amounts of gas and oil have accelerated their transition to clean energy to reduce their vulnerability to supply chain disruptions.
Excluding the pandemic year 2020, 2026 will be the first year since 1983 that worldwide oil usage has decreased. The International Energy Agency predicted in August that this year’s demand will be 1.6 million barrels per day less than the 2025 usage of 106.16 million barrels per day. The August estimated decrease is .51 million barrels more than July’s estimate, so the decrease is likely to get larger the longer the Iran war lasts.
Demand will rebound once the war ends and the price of oil drops, but it may not return to 2025 levels. Worldwide electric vehicle sales rose 35 percent in the second quarter of 2026 from the first quarter and are expected to be 29 percent of all cars sold in 2026, up 1 percent from the forecast two months prior, and up 4 percent from 2025.
Installations of new nuclear, wind, and solar power plants are also increasing. Asia is leading the way in nuclear power construction with 80 plants under construction adding 9.7 billion watts in 2026, 14 billion watts in 2027, and 42 billion more through 2030. Wind projects totaling 565 billion watts along with 3500 billion watts of solar are planned from 2026—2030 around the world. Adjusting the outputs for capacity factors (how much energy a plant can produce in a year), this equates to 1100 billion watts of new generation, or 30 percent of the current world generating capacity of 3600 billion watts.
Solar and wind power generated more electricity in the world than gas turbines for the first time in April 2026, and this was repeated in May. Gas regained the lead in June.
So, it is possible that the wars may have caused the world to hit peak oil usage in 2025, years ahead of predictions. Hopefully natural gas usage will also peak sooner than expected so we can begin reducing our greenhouse gas emissions.
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Bruce Saller is a retired systems engineer with degrees in electrical engineering and computer science.
