By Carly Gilbert-Patrick, Secretary General of the SLOCAT Partnership, and Rana Adib, Executive Director of REN21

The war in Iran has sent oil prices surging again. The head of the International Energy Agency (IEA), now describes the disruption as “more serious than the oil and gas crises of 1973, 1979 and 2022” combined. Once again, the global economy is trembling because it chose fossil fuel dependence over energy independence through renewables. But this time is different. Alternatives exist. They are cheaper. They are ready. Transport, the second-largest emitting sector and the most chained to fossil fuels, has its best window in half a century to break the reliance on fossil fuels.

Every oil price shock since 1973 has been a warning of the danger of fossil fuel dependence. Each one was supposed to be the last. Each one passed, prices stabilized, and the structural addiction held. Governments stuck with what was already in place – efficiency standards, biofuel mandates, marginal reform – policies that delivered measurable progress without threatening fossil fuel revenues, jobs, or political coalitions. Half a century later, fossil fuels still supply 95% of transport energy – a share that has barely shifted in five decades. Transport was responsible for 21.9% of global carbon dioxide (CO2) emissions and consumed one-third (27%) of global end-use energy in 2023. The tried and tested has not worked. It has compounded the problem.

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In 2023, governments spent USD 7 trillion on fossil fuel subsidies, counting both direct support and the unpaid costs of pollution and climate damage. Decarbonizing transport would cost an estimated USD 2.7 trillion a year, covering vehicles, infrastructure, and public transport systems. The money to fix transport exists in nearly three times over the amount. It is being spent, every year, to keep fossil fuels artificially cheap. Governments are simultaneously subsidizing the problem and the solution, and the problem is winning.

Here is what makes the 2026 oil shock different from 1973 and 1979. Those crises hit a world without alternatives. This one, like 2022, does not. Renewable electricity is now cheaper than fossil power in most markets. In 2024 alone, renewables helped avoid an estimated USD 467 billion in global fossil fuel costs. Since the Iran conflict began, EU solar capacity has saved over EUR 110 million daily on gas imports, cutting the bloc’s gas bill by nearly one-third. Whereas fossil fuels demand a continuous, volatile, geopolitically exposed supply chain, renewables, once installed, run on local and predictable costs. Technology is not the bottleneck. Closing the remaining gap means upgrading electrical grids to keep pace with mass electric vehicle (EV) adoption, and securing component supply chains that today are concentrated in a handful of countries. These are solvable problems, but they are not being solved at the speed the moment demands.

In cities, the cheapest barrel of oil is the one you never burn. Public transport, walking, and cycling can cut urban transport emissions by 20% to 50%, and can be built fast and affordably. E-bike sales are surging across Europe and elsewhere. From Paris to Bogotá to Melbourne, compact, walkable, public transport-oriented planning is proving to be the most cost-effective climate policy available. But when it’s not possible, EVs could complement the grid. EV sales broke records in 2024, yet sales of internal combustion engines still grew. SUVs reached nearly half of all new cars sold globally, raising CO2 emissions and road fatalities. No EV policy, however ambitious, can outrun a pricing system rigged against it. The constraint has never been financial. It is political. For intercity and freight – rail and EVs. For cities – feet, pedals, and buses. The full toolkit exists; what is missing is the decision to use it at scale.

This is not a call into the void. A political coalition is forming. At the 2025 UN Climate Change Conference (UNFCCC COP 30) in Belém, Brazil, Chile launched a declaration, endorsed by ten countries including Brazil, Colombia, Norway, and Spain, to reduce transport energy demand 25% by 2035 and shift to one-third renewables and sustainable biofuels. Last month in Santa Marta, Colombia, the First Conference on Transitioning Away from Fossil Fuels brought together 18 governments and more than 4,200 organizations behind an initiative towards the development of a Fossil Fuel Treaty, built on non-proliferation, fair phase-out, and just transition. The COP 30 Roadmap on Fossil Fuels and the UN Decade of Sustainable Transport (2026-2035) give these efforts an institutional runway. The question is whether governments will build on this momentum.

Four priorities should anchor what comes next:

• Set a unified, simple, and actionable global goal for transport that expands inclusive access, phases out fossil fuels, and reduces energy demand;
• Phase out fossil fuel subsidies and redirect them to clean transport;
• Leverage the transport-energy nexus in national climate plans through scaling up renewables and expanding clean, energy-efficient solutions for passenger and freight transport; and
• Build the Santa Marta process and the Fossil Fuel Treaty into the architecture that turns the Paris Agreement on climate change from pledge into delivery.

The carbon budget for 1.5°C runs out by 2032. Transport emissions hit record highs in 2024. The next oil shock is already here. The solutions are ready. The coalitions are forming. The only ingredient we now need is political will at scale.

The best time to phase out fossil fuels was 50 years ago. The next best time is now. The war in Iran just made the cost of inaction impossible to ignore.