The New Wars and the Next Oil Crisis

by Maj (ret’d) CORNELIU, CHISU, CD, PMSC FEC, CET, P.Eng. Former Member of Parliament Pickering-Scarborough East In every era of modern history, major geopolitical conflicts have had an energy dimension. From the mechanized armies of the twentieth century to today’s globalized economies, oil has remained one of the central strategic commodities shaping international relations. What is changing today is not simply the price of oil or the fragility of supply routes, but the very nature of conflict itself. The wars of the twenty-first century are evolving into what analysts increasingly call “new wars”—conflicts that blend military confrontation, economic pressure, cyber disruption, and control of strategic resources. At the center of this emerging landscape lies a familiar but increasingly volatile factor: oil. The modern world still runs largely on petroleum. Despite advances in renewable energy, nuclear power, and electrification, oil remains the backbone of transportation, aviation, shipping, petrochemicals, and military logistics. This dependence gives oil an extraordinary geopolitical weight. When wars disrupt production or transportation routes, the consequences ripple across global markets within hours. The lesson is not new. The 1973 Oil Crisis demonstrated how vulnerable industrial economies can be when energy supply becomes entangled with geopolitical confrontation. In response to Western support for Israel during the Yom Kippur War, Arab oil producers imposed an embargo that sent prices soaring and triggered economic turmoil across Europe and North America. Inflation surged, growth slowed, and governments realized that energy security was inseparable from national security. Half a century later, the global energy system is once again under stress—but the dynamics are more complex. Today’s conflicts rarely resemble the traditional wars of the twentieth century. Instead of clearly defined battle lines between large armies, the international system increasingly faces hybrid confrontations involving proxy actors, economic sanctions, cyber warfare, and the manipulation of supply chains. These new forms of conflict often unfold in regions that also happen to sit atop major energy reserves or along critical transportation corridors. The ongoing Russia–Ukraine War provides a striking example. For decades, Europe relied heavily on Russian oil and natural gas. When the conflict erupted in 2022, energy immediately became a strategic instrument. Pipelines were shut down, sanctions multiplied, and European governments scrambled to diversify their supply sources. What might once have been seen purely as a regional conflict suddenly carried global economic implications. Similarly, the present war in the Middle East in Iran continue to hold enormous implications for the world’s energy markets. A significant portion of global oil exports passes through the Strait of Hormuz, a narrow maritime chokepoint connecting the Persian Gulf to international waters. Even minor disruptions in this corridor can send shockwaves through energy markets. Insurance premiums for shipping rise, tanker traffic slows, and prices react instantly. Another emerging flashpoint lies along the shipping lanes linking the Indian Ocean to the Mediterranean through the Suez Canal and the Red Sea. In recent months, attacks on commercial shipping have highlighted how fragile global supply routes can be. The consequences extend far beyond the energy sector, affecting food supplies, manufacturing inputs, and international trade. These developments illustrate an important reality: energy infrastructure has become both a strategic asset and a strategic vulnerability. Pipelines, refineries, shipping lanes, and electricity grids are now targets in geopolitical competition. Disrupting them can produce economic effects comparable to those of traditional military strikes. For countries like Canada, the implications are profound. Canada is one of the world’s major energy producers, possessing vast reserves of oil, natural gas, uranium, and critical minerals. Yet the country also faces the challenge of integrating its energy resources into a coherent national strategy. Infrastructure debates, regulatory complexity, and regional divisions have often slowed the development of projects that could enhance first Canadian then American energy security. At the same time, the global energy transition is accelerating. Governments are investing heavily in renewable technologies, electrification, and hydrogen production. Nuclear power is experiencing renewed interest as countries seek reliable low-carbon baseload energy. Canada, with its engineering expertise and resources, could play a central role in this transformation. However, the transition itself introduces new geopolitical dimensions. Batteries require lithium, cobalt, and nickel. Wind turbines depend on rare earth elements. Electric grids require vast quantities of copper. In other words, the world may gradually move away from oil dependence, but competition over strategic resources will remain. The emerging challenge for policymakers is therefore not simply managing the price of oil but navigating a broader contest over energy systems. Democracies must ensure that their supply chains are resilient, diversified, and secure. They must invest in infrastructure that connects energy production with markets while maintaining environmental responsibility. Above all, they must recognize that economic security and national security are increasingly intertwined. History reminds us that energy shocks rarely occur in isolation. They are usually symptoms of deeper geopolitical tensions. The risk today is not merely another temporary spike in fuel prices, but the possibility that energy disruptions could trigger wider economic instability in an already fragile global environment. For this reason, energy policy must be viewed through a strategic lens. Investments in nuclear power, critical mineral development, and modernized infrastructure are not simply environmental or economic decisions—they are instruments of national resilience. The world is entering a period in which the lines between economic competition, technological rivalry, and military confrontation are becoming increasingly blurred. Oil will continue to play a major role in this landscape, even as new energy sources emerge. The question facing governments today is therefore clear: will they anticipate the strategic implications of this new energy geopolitics, or will they once again be forced to react when the next crisis arrives? History suggests that foresight is far less costly than surprise.