\nSubstack Essays: Thoughtful Energy Journalism<\/a>
\nEnergi Talks Audio Podcast<\/a><\/p>\n
Real story of this energy crisis is not supply disruption, but demand transformation<\/h2>\n
Turn on the news, and you hear about war in the Middle East, the Strait of Hormuz, and rising oil and gas prices. Governments talk about supply. Exporters talk about opportunity. But the real story is happening somewhere else in the demand system. And it is moving much faster than most policymakers understand.<\/p>\n
The current geopolitical shock\u2014like the Russia\u2013Ukraine war before it\u2014is not strengthening fossil fuels, but accelerating their displacement. Not because of climate policy, but because of basic economics that wouldn’t surprise most consumers.<\/p>\n
I recently sat down with energy economist Dr. Chris Bataille to unpack what\u2019s really happening in global energy markets. You can watch the full interview here<\/a>.<\/p>\n But the system has changed. For decades, fossil fuels had no real competition. When prices rose, consumers absorbed the shock because there were no viable alternatives. Today, electricity\u2014powered by solar, wind, and batteries\u2014competes directly across transport, buildings, and parts of industry.<\/p>\n \u201cOne of the things that\u2019s happening is probably the biggest boost to global decarbonization ever, more than any policy that\u2019s ever occurred, that’s trying to make it easier for you to have,” said Bataille.<\/p>\n “The top 20 per cent of the crude oil supply curve is now wildly uncertain. And the top 20 per cent of the LNG supply curve is wildly uncertain. dIn previous crises there just weren\u2019t other options. But the world has really changed in the last five years. Solar and batteries have really come on mainstream.\u201d<\/p>\n That change is now driving behaviour.\u00a0Countries are not waiting for markets to stabilize. They are redesigning their energy systems.<\/p>\n The shift is not subtle. It is structural.<\/p>\n Electricity demand is rising rapidly across transport, buildings, and industry as economies electrify.\u00a0What matters is not just growth, but composition.\u00a0Electric vehicles, cooling demand, and industrial electrification are becoming the dominant drivers of energy demand growth. That means the system is shifting from fuels to electrons.<\/p>\n Bataille sees this clearly in global markets.<\/p>\n \u201cThe new standard is basically solar, and to a certain extent batteries. It\u2019s not coal plants like everyone imagined. The dominant amount of energy that\u2019s being used is from solar,” he said<\/a>. \u201cThat\u2019s really the story globally. And we\u2019re not seeing it because we live in a country with copious amounts of gas.\u201d<\/p>\n The real pressure is coming from emerging economies.\u00a0After Europe outbid developing countries for LNG following Russia\u2019s invasion of Ukraine, many were forced to rethink their dependence on imported fuels.<\/p>\n That lesson stuck.<\/p>\n \u201cAnd here we are once again, driving up LNG, driving up oil,\u201d I said during the interview. \u201cThe lesson is not lost on the Global South. This is expensive. They have to use US dollars to pay for it. And there are alternatives.\u201d<\/p>\n Bataille agreed\u2014and pushed it further.<\/p>\n \u201cThe amount\u2014like as you say\u2014they have to get U.S. dollars to buy it. It becomes a really big macroeconomic problem really quickly. A lot of places are curtailing industrial production because they can\u2019t get LNG or crude oil. They are going to be looking very carefully at alternatives in all sectors. And this is going to take a big structural chunk out of the global fossil fuel market.\u201d<\/p>\n Those alternatives are increasingly clear.\u00a0Solar is now the dominant source of new power capacity globally. It is cheap, scalable, and deployable without fuel imports.\u00a0That makes it ideal for countries trying to reduce exposure to volatile global markets.<\/p>\n China has spent two decades preparing for this moment.\u00a0It built manufacturing capacity across solar, batteries, EVs, and grid infrastructure. Now it is exporting that system into emerging markets.<\/p>\n \u201cAnd what\u2019s really interesting is everyone keeps looking at what China did five or ten years ago. They\u2019re not looking at what China\u2019s doing right now,\u201d Bataille said<\/a>. \u201cThey\u2019re taking all that industrial policy and turning it on the industrial sector. The next thing that\u2019s going to go is industry and chemical products.\u201d<\/p>\n That expansion is already reshaping global energy flows.<\/p>\n \u201cAnd that is cascading throughout the world with their overcapacity,\u201d he added. \u201cThey\u2019ve moved really quickly to give themselves more options for their electricity system, their chemical products system, and their transport sector.\u201d<\/p>\n The result is a feedback loop:<\/p>\n This has direct implications for oil markets.\u00a0Roughly half of global oil demand comes from road transport\u2014the sector most exposed to electrification.\u00a0Electric vehicles are scaling rapidly, particularly in China and increasingly in developing markets.<\/p>\n Bataille does not hedge on the implications:\u00a0\u201cThe crude oil demand for transport is a dead man walking at this point in time. It\u2019s about 50 per cent of global oil demand. That\u2019s the sector that\u2019s going to go.\u201d<\/p>\n Even if that timeline proves aggressive, the direction is clear. And once demand begins to erode, it weakens at the margins first\u2014the highest-cost, least secure supply.<\/p>\n That is exactly the portion of the market now under pressure.<\/p>\n Canada continues to view the world through a petroleum lens.<\/p>\n \u201cWe still see global energy issues through the petroleum lens,\u201d I said during the interview. \u201cFrom the federal government on down.\u201d<\/p>\n That framing leads to a dangerous assumption: that high prices are a windfall.\u00a0In reality, they are a catalyst.<\/p>\n \u201cAnd what they\u2019re not seeing is the shock that that\u2019s still delivering to demand globally,\u201d Bataille said. \u201cThis is like a quasi standstill for a lot of places. They\u2019re going to move away from it.\u201d<\/p>\n The risk for Canada is not cyclical. It is structural.<\/p>\n If global demand begins to weaken faster than expected, long-lived infrastructure bets\u2014pipelines, LNG terminals\u2014become harder to justify.<\/p>\n The global energy system is not waiting.\u00a0It is being reshaped by price shocks, technological substitution, and industrial strategy.\u00a0The question is not whether this transition will occur.<\/p>\n It is whether countries like Canada recognize it in time. Because the real story of this energy crisis is not supply disruption.\u00a0It is demand transformation.<\/p>\n And that story is already underway.<\/p>\n To watch more energy expert interviews on this topic, you can find them on the following playlists on the Energi Media YouTube channel: To learn more about energy transition theory, take our free<\/strong> one-hour training course: The Energy Transition Explained<\/a>.<\/p>\n![\"\"](\"https:\/\/energi.media\/wp-content\/uploads\/2026\/04\/global-electricity-total-demand-growth-by-sector-and-end-use-2015-2030-300x250.png\")
The system is electrifying faster than expected<\/h3>\n
The Global South is forcing the transition<\/h3>\n
![\"\"](\"https:\/\/energi.media\/wp-content\/uploads\/2026\/04\/total-renewable-capacity-additions-by-technology-2019-2024-678x381.png\")
China is capturing the shift<\/h3>\n
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Oil demand is more fragile than it appears<\/h3>\n
![\"\"](\"https:\/\/energi.media\/wp-content\/uploads\/2026\/04\/global-electric-car-sales-2014-2024-678x381.png\")
Canada is still telling itself the old story<\/h3>\n
The system is already changing<\/h3>\n
\nElectrotech Revolution Explained<\/a>
\nElectric Vehicles<\/a>
\nEnergy Transition<\/a><\/p>\n