The Iran war increases interest in renewable energy projects economy

Bloomberg quoted the Infrastructure Development Group as saying that the rise in oil prices during the Iran war raised interest in renewable energy projects and those concerned with ensuring the security of energy supplies.

The American-Israeli war on Iran led to a rise in the price of Brent crude oil to about $100 per barrel, after navigation stopped in the Strait of Hormuz, through which about 20% of the global supplies of oil, gas, and oil derivatives pass.

Oil prices fell after signing a memorandum of understanding to stop the war to about $80 per barrel of Brent crude, and the price of West Texas Intermediate crude oil reached about $77.9 per barrel for futures contracts today, Friday.

Bloomberg added that the Infrastructure Development Group, supported by the World Bank and European governments in addition to Australia and Canada, is working on projects worth $3 billion in emerging markets this year, a number close to last year’s investments, but the investment focus has shifted more clearly towards renewable energy projects and enhancing security of supply.

Bloomberg quoted Marco Serena, Director of the Sustainable Impact Sector at the Infrastructure Development Group, as saying, “We expect strong performance in the second half of this year,” driven by increased demand for renewable energy infrastructure by governments in emerging markets and the private sector with the aim of securing energy supplies.

Find alternatives to oil

Bloomberg explained that the high cost of energy during the Iran war, and the short supply of oil in the markets during the war, prompted governments in emerging markets to search for energy alternatives with the aim of reducing their dependence on oil and gas.

The International Energy Agency said in its monthly report on the oil market issued on Wednesday that despite the significant declines in demand for crude oil and oil derivatives, global crude stocks “are still eroding at a record pace.”

The agency explained that global oil stocks may reach historic low levels this year, before the market balance turns into surplus by the end of next year, with the increase in oil production.

Since 2002, the Infrastructure Development Group has participated in financing projects worth $51.4 billion, including $32.7 billion for the private sector, according to Bloomberg.

Among the projects that the group participated in implementing are the first sustainable aviation fuel plant in Pakistan, the “Electricity for All” program in Ivory Coast, and the establishment of an electric vehicle charging network in Laos in Southeast Asia.