Middle East Conflict Boosts China’s Green Industry: Global Expert Perspectives

The escalating conflict in the Middle East is not only shaking global energy markets but also creating a new catalyst for the transition toward clean energy. In this shifting landscape, many international experts believe China stands to benefit the most, thanks to its dominant position in the green technology supply chain.

Energy Shock and Global Ripple Effects

With around 20% of global oil and gas supply passing through the Strait of Hormuz now disrupted, energy prices have surged, forcing many countries to reassess their energy security strategies. Beyond increasing reserves and reducing consumption, the shift toward renewable energy is accelerating.

According to Fitch Ratings, countries heavily reliant on energy imports—especially in Europe—are expected to ramp up investments in renewable power and energy storage systems. This is seen as a structural response rather than a short-term reaction to geopolitical instability.

China Benefits from Supply Chain Dominance

Analysis from the International Energy Agency shows that China currently produces over 85% of the world’s batteries and around 70% of electric vehicles. This positions the country as an almost irreplaceable supplier in the short term.

Sam Reynolds from the Institute for Energy Economics and Financial Analysis noted that China’s strategy of linking energy security with green industrial development “is being validated” amid the current crisis.

Meanwhile, Amy Myers Jaffe argued that the energy shock “could strengthen China’s global industrial position, particularly in electric vehicles and battery storage, while putting pressure on the U.S. automotive sector.”

Strong Market and Investor Reactions

Financial markets are already reflecting these expectations. Shares of CATL and BYD have surged as investors bet on rising demand for clean energy technologies.

Real-world demand is also shifting. In the UK, data from Octopus Energy shows a sharp increase in electric vehicle rentals and rooftop solar installations within weeks of the conflict’s escalation.

Are Other Countries Shifting Direction?

A key question is whether the world is becoming more dependent on China—or whether other countries are also adjusting their strategies.

Experts suggest the answer is nuanced: countries are shifting, but in different ways.

In Southeast Asia, Indonesia is emerging as a major example. The government is accelerating electric vehicle adoption and building out charging infrastructure. According to researcher Putra Adhiguna from the Energy Shift Institute, the region is becoming a “new hotspot” for clean technology demand, with Chinese firms playing a central role in supply chains.

In South Asia, Pakistan has significantly increased imports of Chinese solar panels, highlighting a strategy of leveraging cost-effective supply to accelerate energy transition.

In Europe, while ambitions for technological independence remain, countries face a dilemma: reducing reliance on fossil fuels while depending on China’s dominant clean energy supply chain.

The U.S. Takes a Different Path

In contrast, the administration of Donald Trump continues to prioritize fossil fuel production and energy exports. While this may deliver short-term gains, experts warn it could weaken the U.S. position in the long-term green technology race.

A New Global Energy Order Emerging

Overall, global experts agree that the Middle East conflict is more than a regional crisis—it is accelerating the restructuring of the global energy system.

China, with its long-term investment strategy and integrated industrial ecosystem, is in a leading position. However, other countries are not standing still. They are adapting—either by accelerating energy transitions or diversifying supply sources to reduce geopolitical risks.

The key question now, analysts say, is no longer whether the transition will happen, but who will control the value chains of the future green economy.