Oil stands at about $110 a barrel and some forecasts have predicted it could reach $150. Food prices are on the rise and are expected to leap further owing to the fertiliser supply crunch, leading the World Food Programme USA to warn that global food insecurity could reach record levels, with 45 million more people pushed into acute hunger. Industries from steel to chemicals have alerted markets that they face shortages and soaring costs, while households across the world are feeling the pinch – people have been told to turn down their thermostats, take the bus or cycle, and cut their speed on motorways.
The impact of the US-Israel war on Iran – the third global shock in six years, after Russia’s full-scale invasion of Ukraine and the Covid-19 pandemic – has laid bare how reliant our economies still are on fossil fuels. Simon Stiell, the UN climate chief, said in March: “Fossil fuel dependency is ripping away national security and sovereignty and replacing it with subservience and rising costs.”
In the past year, the Guardian has examined the 10 countries most responsible for greenhouse gas emissions. They divide broadly into two camps: those wedded to fossil fuels and determined to wring every last drop from them; and those pursuing a low-carbon future to remove the yoke of oil dependence and stave off climate catastrophe. They are the vanguard of a global realignment: the electrostates of the future v the petrostates of the past.
“We are at the dawn of the electrostates versus petrostates, and electricity is the holy grail right now for everybody,” John Kerry, the former US secretary of state, said in an interview with the Guardian. “The future is being able to harness the power of electrons and send them where we need them, and use them where and when we need them.”
The Iran war has thrown the divergence into sharp relief and shown which of the 10 biggest emitters can expect to emerge stronger from the crisis. Global trends already favoured renewables: last year, the amount of electricity generated from low-carbon sources overtook that produced from coal for the first time. Investment in clean energy now outstrips that into fossil fuels by two to one. Coal-fired power generation fell in China and India for the first time since the 1970s.
But the war in Iran, and the Ukraine war before it, have also exposed a sobering reality. Many of the world’s most powerful countries and biggest emitters are beneficiaries of high fossil fuel prices. The US oil and gas sector is set for a $60bn windfall from the war; soaring commodity prices have been a lifeline for Russia, whose economy was floundering under the strain of maintaining war in Ukraine but which has now had some sanctions lifted; Saudi Arabia has been struck by Iranian missiles and was forced to shut its biggest refinery but the share price of its national oil company, Aramco, has surged and its easily accessible reserves are reaping bumper returns. Iran’s oil revenues have increased, despite attacks on its infrastructure that have sent toxic acid rain pouring down on its people.
High prices boost petrostates, generating bonanzas they can pour into further expanding their hydrocarbon extraction.
China, the world’s biggest emitter and second biggest economy, is leading the charge for an electrified future. The country’s emissions have been flat or falling for nearly two years – and though China has followed a similar pattern in the past before roaring upwards again in a coal splurge, analysts say it is different this time. Renewables are growing at record levels, for use not just domestically but for export – green technology, including electric vehicles and batteries as well as wind and solar power components, now makes up more than a tenth of China’s export business, and a similar proportion of its overall economy.
“This emissions pattern is hopefully a decline that will be maintained,” says Li Shuo, the director of the China climate hub at the Asia Society Policy Institute. “There is no interest group in China advocating [for a swing back to coal] which gives us confidence that the trend is sustained and structural.”
China added 360GW of new solar and wind capacity in 2024 and 430GW in 2025. Clean energy drove a third of the country’s GDP growth last year, according to Carbon Brief. Investments in clean energy topped $1tn, nearly four times the $260bn the country poured into fossil fuel extraction and coal power.
The key will be to see whether the “hand-in-hand” strategy of using coal alongside renewables is let go as battery manufacturing ramps up further, says Li. “Batteries may be able to meaningfully replace coal in China’s power system,” he said. “I think we will see more batteries and less coal.”
India, the world’s most populous nation, biggest democracy, and fourth biggest economy, still has some way to catch up but is certainly in the race. To the surprise of many observers, India at the end of March produced a new national plan on greenhouse gas emissions – known as a nationally determined contribution (NDC) under the Paris agreement. The plan sets a target of generating 60% of electricity from low-carbon sources by 2035 and cutting emissions per unit of GDP by 47%.
These targets are not stretching – India’s renewable energy sector is growing rapidly, with a record year last year in which 45GW of capacity was added, nearly double the previous amount – and the Climate Action Tracker forecasts that the 60% target will be met five years early, by 2030. But the NDC still represents an important step forward for a country that last year celebrated its billionth tonne of coal production and has played an occasionally disruptive role at international climate meetings.
Arunabha Ghosh, the chief executive of the Council on Energy, Environment and Water thinktank, said: “At a time when conflict and energy security concerns are pulling countries away from climate commitments, India’s new NDC sends an important signal. [It] suggests that India is internalising the idea of a ‘green economy’ – where climate action is not treated in a silo, but embedded within the country’s broader development and economic strategy.”
No one should imagine that the end of coal in India is nigh, though, says Zerin Osho, the president of the Gateway Research Institute. “India’s transition is likely to be more of a hybrid developmental path than a leapfrog,” she said. “The government has a clear stance that traditional fossil fuels like coal will remain important levers for energy security in the country as the economy and industries grow, particularly in the near to medium term. India is not treating this as an either-or choice.”
Though the biggest emitting countries fall broadly into two camps, the boundaries are blurry. None of the supposed electrostates can claim purity in their pursuit of a clean future. Germany, for instance, while an early pioneer of solar panels and wind turbines, has a continuing attachment to gas and is rowing back on low-carbon heating reforms, while some of its carmakers are reneging on electric vehicles. Japan, likewise, has fallen short, assuming a low profile at international climate negotiations and putting forward an NDC that analysts found grossly inadequate.
Many countries are being pulled in two directions. At the Cop26 summit in 2021, Indonesia enthusiastically embraced plans to become of the first examples of a “just transition” – a way of shifting from reliance on fossil fuels to clean energy while preserving jobs, retraining workers and helping vulnerable people – with a promised $20bn from rich countries and private investors to help shut down some of its massive coal sector. Indonesia is the world’s third biggest producer of coal, with more than 800m tonnes produced in 2024 from about 160 mines, as well as relying on coal for most of its power needs.
But the “just transition energy partnership” quickly ran into trouble. Attempts to shut down coal plants faltered in the face of strong vested interests, the government allowed a resurgence of mining as coal prices made it more profitable, and the hoped-for investment in clean energy jobs ran into bureaucratic shoals.
These problems can be overcome – there are signs that Indonesia’s government is keen to resume some of the effort, even though the US has left the field and the promised billions are slow to arrive. Rampant deforestation may prove more intractable – Indonesia signed a pledge to halt deforestation by 2030 but last year embarked on the world’s largest felling project to clear land the size of Belgium for sugar cane and ethanol.
Iran is another case: when the Guardian last year investigated the climate-exacerbated water crisis that was building to a “day zero” when supplies would run dry, few could have anticipated a war would imminently plunge the regime into chaos, threatening desalination plants and targeting oil installations. Iran could emerge with a stronger focus on fossil fuels as it needs to reconstruct its economy, and some observers believe Donald Trump could attempt to forge a deal on the country’s oil.
Amid this devastation, there could be a glimmer of a silver lining. Before the US-Israel attacks, Iran already had some of the worst fossil fuel extraction infrastructure, losing an estimated 40% of its natural gas – methane – to leaking and flaring. Methane is 80 times more powerful as a greenhouse gas than carbon dioxide, meaning such leaks have an outsized impact on the planet. If Iran’s infrastructure could be rebuilt to higher standards as part of a reconstruction effort, it could make a massive difference to the country’s status as one of the world’s top “super-emitters” of methane.
Of the top 10 emitters, the US under Trump stands out as the most paradoxical. Emissions were falling until last year. March 2025 was the first month in which low-carbon sources made up more than half of electricity generation. The green economy boomed after Joe Biden passed the Inflation Reduction Act, which offered tax breaks and incentives, grants and business loans. The Roosevelt Institute reported that two years after its introduction, business and consumer investment in the green economy reached nearly $500bn and clean technology accounted for more than half of the total US private investment growth.
Trump set out a year ago to dismantle all of that, boost oil and gas and throw a lifeline to the moribund coal market. Ideology even appears to be trumping the economy: last month, his administration agreed to pay $1bn to France’s Total Energies to halt the building of two offshore windfarms, with the money to be re-invested in oil and gas projects.
“Trump is conducting a political and economic culture war against all forms of climate protection, domestic and international,” says Paul Bledsoe, a former Clinton White House climate adviser, now with the American University. “Trump, Putin and other rightwing tyrants are risking the security and safety of billions of people around the world for short term and illusory political gains. Trump’s climate nihilism is the equivalent of declaring war on most of the world’s population.”
Across the US, many states, businesses and investors are still grasping the opportunities of clean technology. California now generates two-thirds of its electricity from low-carbon sources and Texas gets a similar proportion from wind and solar at peak times.
But Bledsoe says it will not be enough to prevent Trump dragging the US back into the fossil fuels quagmire. “Climate action by half of the US states and much of the private sector can continue to make some needed climate protection investments, but ultimately Maga will have to be defeated politically at a national level to limit additional climate disasters.”
If the US – the world’s biggest oil producer, even under Biden – still has pockets of green optimism, look for none in Russia. Vladimir Putin used oil and gas as weapons of war in 2022 when he invaded Ukraine and shows no sign of stopping. Russia is the third largest producer of oil and gas globally, behind the US and Saudi Arabia, and is reaping an extra $150m a day as the war continues in Iran.
Putin has no interest in even paying lip service to climate action, says Bledsoe. “He does not need to, he never will do it,” he says. At UN climate summits, Russia plays little role, though is a signatory to the 2015 Paris agreement. To make things worse, Russia’s oil and gas infrastructure leaks vast quantities of methane, with little effort at abatement.
About a third of Russia’s electricity comes from low-carbon sources – its ageing nuclear plants. Less than 1% of the country’s power is from wind and solar, according to the Ember thinktank.
Ultimately, if such recalcitrant countries will not heed the dangers of climate breakdown, the most powerful means of persuasion is to starve them of customers, says Bledsoe. “Stop buying their products.”
Time is running out to convert petrostates – many of which are not democracies, making any form of voter persuasion and most forms of civic pressure impossible – into clean technology hubs.
A few are taking steps towards domestic renewable energy generation. “The Saudis are so advanced in their transition it is awe-inspiring,” says Vera Songwe, a Cameroonian economist. “I have gone there and seen what they are doing in the energy sector and with their new green city.” But they have no intention of winding down their oil exports.
Durwood Zaelke, the president of the Institute for Governance and Sustainable Development, has a different plan. He believes some countries that are failing to cut their carbon dioxide output could be encouraged at least to tackle one of the most potent forms of greenhouse gas: methane. “The rate of warming is accelerating, and we’re activating self-amplifying feedback loops that are pushing us past irreversible tipping points,” he says. “Cutting methane is the best – and so far the only – way to slow near-term warming in time to slow the feedbacks that are pushing the planet to the edge of the tipping points.”
Reducing methane now could cut temperatures by 0.3C by the 2040s, studies have shown. Satellites can show to high accuracy where the sources of methane are – including coalmines, landfill sites and leaking oil and gas infrastructure – so they can be tackled. When prices are high, oil and gas companies have an incentive to capture the gas, which can be resold, instead of venting or flaring. Coal will need greater government intervention – abandoned coalmines are now one of the biggest sources of methane globally, the International Energy Agency said last year.
Zaelke says: “Because cutting methane is the only way to slow near-term warming, it is inevitable that we will one day have a mandatory methane agreement, starting with a coalition of the willing and extending to the rest of the world in time. The question is – when? Will it be soon enough to avoid the worst?”
One other point that is clear from examining the world’s biggest emitters is that leaving the green transition to the untrammelled free market will not work, despite the rapid falls in price of renewable energy and surges in private sector green investment.
Jayati Ghosh, an Indian development economist and professor at the University of Massachusetts in the US, said: “No green transition has occurred or can occur without government intervention. The Chinese example is evident, but even for all other countries, effective uptake requires, first of all, electrification of transport as much as possible, which in turn means ensuring availability of electric vehicles, whether through domestic production or imports, [plus] providing initial subsidies to producers and consumers to encourage the shift, creating the enabling ecosystem of charging points, and ensuring that the electricity is produced through more renewable sources.”
The war in Iran may be over within days, weeks or months, but the lingering impacts will shape our global future. The 10 biggest emitters generate roughly two-thirds of the world’s annual carbon output, and many of them – Russia, Saudi Arabia, Iran, the US, Indonesia – are also responsible for exports of fossil fuels that raise global emissions even further. They hold the world’s future in their hands. Whether we emerge set more firmly on a low-carbon path, or retreat yet further into a climate-blighting oil dependency, will depend to a large extent on the choices these countries make in the war’s aftermath.
Whatever the war’s outcome, one thing is certain: the current shock is only a blip. A far bigger crisis looms that will put the cost of living and recessions into an entirely new perspective. If we reach 2C above preindustrial levels – which on current form could be in less than two decades – the economic impact of climate breakdown will be the equivalent of having a new oil war every single year.
