The Geopolitics of Energy After Fossil Fuel Era

The world is at a crossroads. As the fossil fuel era fades, nations are pursuing vastly different strategies to secure their energy futures. Some, like China and the European Union, are doubling down on the green transition, investing trillions in renewable energy, electric vehicles, and critical minerals. Others, particularly the United States under its current administration, have reversed course, embracing a resurgence of fossil fuel extraction, from drilling in protected national parks to even pursuing the purchase of Greenland to secure oil and mineral access.

This divergence is not just about climate policy: it is reshaping global power structures, economic dependencies, and geopolitical alliances. The energy transition is no longer a straightforward march toward sustainability; it has become a fragmented, competitive landscape where green ambition clashes with fossil fuel pragmatism, and where critical minerals have replaced oil as the new geopolitical battleground.[1]

The U.S.’s Fossil Fuel Revival

The United States, under its current leadership, has abandoned its earlier commitment to a rapid green transition, instead reviving fossil fuel extraction in a bid to secure energy dominance. This shift is most evident in the aggressive expansion of oil and gas drilling, even in protected areas that were once off-limits.[2]

The administration has authorized new drilling projects in national parks and wildlife refuges, a move that has drawn sharp criticism from environmentalists and Indigenous communities alike. Perhaps most controversially, it has reopened the Arctic National Wildlife Refuge (ANWR) in Alaska for drilling, a decision that reverses decades of conservation efforts and risks irreversible ecological damage.[3] Additionally, the U.S. has explored the possibility of purchasing Greenland from Denmark, not merely for strategic military reasons but also to secure access to rare earth minerals and potential oil reserves in the Arctic.

This fossil fuel revival is driven by short-term energy security concerns, particularly in the wake of the Ukraine war, which exposed vulnerabilities in relying on foreign oil and gas. However, it contrasts sharply with Canada’s approach, where the government is investing heavily in renewable energy while maintaining a phased approach to oil sands development.

The U.S.’s fossil fuel push is creating rifts with its allies. Europe, which is accelerating its green transition, views America’s renewed focus on fossil fuels as hypocritical, given its past leadership in climate diplomacy. The U.S.’s strategy risks undermining global climate goals while reinforcing its role as a top oil and gas producer, ensuring its energy dominance in the short term. However, this approach may prove short-sighted, as the long-term economic and environmental costs of fossil fuel dependence could outweigh the benefits.

Europe: The Green Transition as a Geopolitical Imperative

Europe remains the most committed region to the green transition, viewing it not just as an environmental necessity but also as a geopolitical strategy to reduce dependence on fossil fuel imports, particularly from Russia. The European Union’s REPowerEU Plan is the cornerstone of this strategy, aiming to phase out Russian gas by accelerating renewable energy deployment, improving energy efficiency, and diversifying gas supplies.[4]

Countries like Germany and the Netherlands are leading in offshore wind energy, while Spain and Portugal are emerging as hubs for green hydrogen production, leveraging their abundant solar and wind resources. France, meanwhile, is betting on nuclear energy as a low-carbon baseload power source, despite the high costs and challenges of nuclear waste management. The country’s commitment to nuclear reflects Europe’s pragmatic approach to energy security, balancing climate goals with the need for reliable, continuous power.

Despite its ambitious goals, Europe faces significant challenges. Energy security concerns persist, as the region remains dependent on critical minerals, such as lithium, cobalt, and rare earth elements, for batteries, wind turbines, and other renewable technologies. Much of these minerals are controlled by China, raising concerns about over-reliance on a single supplier and the geopolitical risks of supply chain disruptions. Additionally, industrial competition with the U.S. and China is intensifying. Europe is seeking to onshore clean energy supply chains to avoid over-reliance on foreign suppliers, but this requires massive investments and coordination among member states, which has proven difficult.

Consequently, Europe’s green transition is reshaping its foreign policy. The EU is forging partnerships with North African countries -such as Morocco, with its vast solar projects, and Egypt, with its expanding wind farms- to import green hydrogen and electricity. These partnerships are not just about energy security but also about geopolitical influence, as Europe seeks to reduce its dependence on fossil fuel exporters in the Middle East and Russia. Therefore, Europe’s approach to the energy transition is long-term and systemic, but its success depends on securing critical minerals and avoiding over-reliance on China.

China’s Green Dominance vs. Japan and South Korea’s Balancing Act

China has far outpaced the rest of the world in renewable energy deployment, dominating global supply chains for solar panels, wind turbines, and electric vehicles (EVs). The country accounts for nearly 35% of global solar installations and 40% of wind power additions, making it the undisputed leader in clean energy deployment. Not to mention that China produces 60% of the world’s EVs and controls 80% of battery manufacturing, ensuring its dominance in one of the fastest-growing industries of the 21st century. Additionally, China is expanding its influence in critical minerals, controlling 80% of rare earth element production and investing heavily in lithium and cobalt processing.[6]

On the other hand, both Japan and South Korea lack domestic fossil fuel resources and have historically relied on imports. Their strategies now focus on hydrogen and ammonia as alternative fuels for power generation and shipping, as well as nuclear energy to ensure energy security. Both countries are also expanding offshore wind energy, with South Korea aiming to become a global leader in floating wind farms. [7]

The U.S.-China rivalry is playing out in East and Southeast Asia, with both superpowers competing for influence in the clean energy sector. The U.S. is trying to decouple from China’s clean tech dominance, while China is expanding its influence in Southeast Asia and Africa for critical minerals. Japan and South Korea, caught in the middle, must balance green ambitions with energy security, leading to investments in both renewables and fossil fuel alternatives, such as liquefied natural gas (LNG) imports.

The Middle East and North Africa (MENA): The Race to Diversify Before the Fossil Fuel Decline

The MENA region, long dependent on oil and gas revenues, is under immense pressure to diversify as global demand for fossil fuels declines. Countries like Saudi Arabia and the UAE, for instance, are consequently betting big on renewables; but others, such as Iraq and Libya, face economic crises as their fossil fuel-dependent economies struggle to adapt.

These countries' efforts are not just about economic diversification but also about securing a place in the post-fossil fuel world. By investing in renewables, this region hopes to maintain their influence even as global demand for oil and gas declines. A good example of this long-term strategy is Saudi Arabia’s Vision 2030, which includes $500 billion in renewable energy projects, with the NEOM megacity designed to run entirely on renewable energy.[8]

The energy transition is also reshaping regional alliances. Traditional fossil fuel importers, such as Europe, are increasingly looking to MENA for renewable energy imports, particularly green hydrogen. This is creating new forms of interdependence between Europe and MENA, as well as new geopolitical tensions. For example, the competition for influence in the green hydrogen market is intensifying, with both Europe and China seeking to secure supply deals with MENA countries.[9]

Therefore, the transition is not without risks. The decline in fossil fuel revenues could destabilize oil-dependent economies, particularly those with limited economic diversification. Countries like Iraq and Libya, as already stated, rely heavily on oil exports, are facing economic and political instability as global demand shifts away from fossil fuels.

At the same time, the energy transition is creating new opportunities. MENA countries are positioning themselves as future suppliers of green hydrogen to Europe and Asia, leveraging their abundant sunshine and wind resources.

Africa: Critical Minerals and the Green Transition’s Double-Edged Sword

Africa holds nearly 30% of the world’s critical mineral reserves, making it a key battleground in the energy transition.[10] The Democratic Republic of the Congo (DRC), for example, produces 70% of the world’s cobalt, a key mineral for electric vehicle batteries. However, its cobalt mines are dominated by Chinese firms, which have invested heavily in infrastructure and processing plants. This dominance has raised concerns about exploitation and environmental damage, as mining operations often displace local communities and contaminate water supplies.

The race for critical minerals, thus, has turned Africa into a geopolitical battleground. China is securing long-term supply deals across the continent, while the U.S. and EU are investing in alternative supply chains in countries like Australia and Canada to reduce dependence on China. African nations, meanwhile, are struggling to capture value from their mineral wealth. Most profits from mining operations go to foreign firms, leaving local communities with little economic benefit.

Despite these challenges, Africa has enormous potential to benefit from the energy transition. Countries like Kenya for geothermal energy and Morocco for solar power are leaders in renewable energy deployment, and there is growing momentum for local processing of critical minerals before export.

Latin America: Renewables in a Region of Contrasts

Latin America presents a mixed picture of energy transition efforts. While some countries are embracing renewables, others remain deeply dependent on fossil fuels.

Brazil, for instance, pertains to the first group of countries as it generates over 80% of its electricity from hydropower, making it one of the greenest energy systems in the world.[11] The country is also expanding wind and solar energy, positioning itself as a regional leader in renewables.

In contrast, Venezuela and Mexico remain heavily dependent on oil, despite declining production and economic instability. Venezuela’s state-owned oil company is in crisis, while Mexico’s energy policies under President López Obrador have rolled back renewable energy projects in favor of state-controlled fossil fuel production.

To even complicate more the picture, the U.S. and China are competing for influence in Latin America’s energy sector. China has dominated critical mineral mining in countries like Chile, Peru, and Argentina, while the U.S. is promoting its own critical mineral supply chains to counter China’s dominance.

The energy transition in Latin America is hampered by social and environmental conflicts. Water scarcity, particularly in Chile’s Atacama Desert, is a major issue for solar energy projects, while Indigenous communities are resisting mining operations that threaten their lands and livelihoods.

Central Asia and the Arctic: The New Frontiers of Energy Competition

Central Asia is rich in critical minerals, including uranium, lithium, and rare earth elements. Kazakhstan and Uzbekistan, in particular, are emerging as key players in the global energy transition.[12] China is investing heavily in Central Asia’s mining and infrastructure sectors, while Russia is trying to maintain its influence in the region. This competition is reshaping geopolitical alliances, with China and Russia vying for control over Central Asia’s resource wealth.

The Arctic, on the other hand, is becoming a new frontier in the energy transition, as melting ice opens up new shipping routes and access to fossil fuel reserves. Russia is expanding Arctic drilling and militarizing the region, while the U.S. and China are competing for access to Arctic resources and shipping lanes. The U.S. has even expressed interest in purchasing Greenland from Denmark, not just for strategic military reasons but also to secure rare earth minerals and fossil fuel access in the Arctic.

However, the Arctic is one of the most fragile ecosystems on the planet, and expanded drilling and shipping threaten to disrupt Indigenous communities and accelerate climate change. The geopolitical competition in the Arctic risks ignoring environmental concerns in favor of economic and strategic gains.

Conclusions

The energy transition is mineral-intensive, requiring lithium, cobalt, nickel, rare earth elements, and graphite for batteries, wind turbines, and solar panels.

China controls 80% of rare earth production and 60% of lithium processing, giving it unparalleled influence over the global clean energy supply chain. The country has secured long-term supply deals in Africa, Latin America, and Australia, ensuring its dominance in critical minerals. While the U.S. Inflation Reduction Act (IRA) offers subsidies for domestic critical mineral production, aiming to reduce dependence on China. The EU Critical Raw Materials Act similarly seeks to diversify supply chains and boost local processing.[13]

The concentration of critical mineral production in a few countries creates supply chain vulnerabilities. A single point of failure could disrupt global clean energy deployment and derail climate goals. Additionally, mining operations in fragile ecosystems often harm local communities and degrade the environment, raising ethical and sustainability concerns.

The green transition is, therefore, redefining energy security. No longer is it solely about controlling oil and gas flows: it is about securing critical minerals, renewable energy infrastructure, and technological leadership.

Countries that dominate clean tech supply chains -such as China in solar, the U.S. in software, and Europe in wind- will hold geopolitical power in the post-fossil fuel era. The race for technological leadership is as much about energy security as it is about economic competitiveness.

The shift away from fossil fuels is also creating new conflicts across the globe. Countries like Russia, Saudi Arabia, and Iran face economic decline as global demand for oil and gas falls. Meanwhile, clashes over climate policies are deepening geopolitical divides.

Thus, the geopolitics of energy after the fossil fuel era is not a smooth transition but a fragmented, competitive landscape. The one million dollar question is therefore: can the world avoid a chaotic transition where fossil fuel dependence persists while climate goals are side-lined? Or will the U.S.’s drilling revival set back global efforts, handing China an even greater advantage in the green economy?

One thing is clear: the energy transition is not just about saving the planet, it’s about who controls the future of energy.