Russell: The war fuel crisis in Iran gives electric vehicles a boost for the long term.

The U.S. president Donald Trump is known for his support of fossil fuels. However, the war on Iran will likely result in an acceleration of energy transitions, particularly in Asia.

Retail fuel prices have risen rapidly in the world's fastest-growing and most populous region since the U.S.-Israeli aerial campaign against Iran began on February 28.

In Australia, for example, the cost of a litre?diesel has reached a record high of A$3 ($2.09), having risen by around 36% since "the war" began, while gasoline prices in Japan have risen by 18%.

The countries that control fuel prices are now struggling with the availability of fuel, as the conflict has effectively closed the Strait of Hormuz. This narrow waterway normally transports 20 million barrels of crude oil and refined products per day from the Persian Gulf into mainly Asian nations.

The price of Brent crude oil futures has risen by 42% in Asia since the beginning of the conflict, to $103.78 per barrel on Tuesday. However, the rise in the physical prices for refined fuels such as gasoline and diesel is much higher.

Singapore gasoil - the main component of diesel - has increased by 104% in price since February 27, ending?at $186.43 per barrel on Monday. Meanwhile, gasoline has increased 91%, reaching a new record high at $151.60.

The sharp rise in prices will likely cause further problems for consumers in Asia over the next few weeks and months. There is also the added risk of a shortage as refineries struggle to find crude oil in the region.

In?Asia, the price increases and fear of shortages will likely boost the popularity of electric vehicles and plug-in-hybrid-electric vehicles.

In many countries EVs and hybrids have already made significant progress, largely due to the cost-competitiveness and government incentives of Chinese vehicles.

China has been the leading country in adopting EVs. This is not surprising, given the massive investments the country made in battery technology in recent years.

In China, EVs and hybrid electric vehicles (PHEVs) accounted for around 12 million sales units last year. This was the first time that EVs or PHEVs accounted for more than half of all new vehicle sales.

Outside of China, the greatest opportunity for growth is outside China.

AUSTRALIA GROWTH

Australia's EV and PHEV sales reached a record in 2025, and represented about 12.7% total light vehicle sales.

The PHEV segment grew faster as consumers continue to worry about the battery range and availability.

The government's tax incentives and cheaper EVs are helping to boost sales, but it is the question of how much the current fuel crisis will affect consumers and how many people will turn to battery power to protect themselves from future shocks.

Australia has already more than one third of its households using rooftop solar. This is an additional incentive for people to switch to EVs or PHEVs, as they are able to use their own electricity in order to charge the vehicles.

Japan could also see a much faster growth of EVs and hybrids. This is because their major automakers are now offering more models.

Electric motorbikes are also gaining in popularity in Southeast Asian countries.

In India, more than 1.3 million two-wheelers will be sold by 2025. This is an increase of over 10% from the previous?year, and the market share has increased to more than 6%.

This is a very strong growth rate. However, there are still opportunities for an even faster growth, particularly if fuel prices continue to rise.

The impact of the Middle East conflict could last long after the Strait of Hormuz is reopened and the Middle East conflict has been resolved.

Asian countries just received a huge incentive to switch from PHEVs to EVs as well as renewable energies such as wind and solar.

Although not a direct comparaison, the European experience after the Dieselgate scandal in 2015 - when Volkswagen was caught manipulating emission tests - can be instructive.

Diesel passenger vehicle sales have dropped from 52% in 2015. to only 8% by 2025. Gasoline-powered vehicles were the main beneficiaries, but more recently, EVs, and PHEVs, have overtaken diesel cars.

It is hard to reverse a trend once it has taken hold. Exporters of crude oil or refined products are at risk of the war changing the minds of consumers and government officials, and reorienting demand and policies towards EVs,PHEVs, and renewable energy generation.

You like this column? Check out Open Interest, your new essential source of global financial commentary. ROI provides data-driven, thought-provoking analysis on everything from soybeans to swap rates. The markets are changing faster than ever. ROI can help you keep up. Follow ROI on LinkedIn, X.

These are the views of a columnist who writes for.

(source: Reuters)