The sharp rise in oil prices following the escalation of war in the Middle East is not simply another episode of commodity volatility. It is a reminder that energy security, long treated as a background assumption in advanced economies, remains structurally fragile. Global fuel markets are still shaped by geopolitics, physical chokepoints and concentrated supply – risks that sit far outside the control of domestic policymakers.
For much of the past decade, debates about energy policy have been framed around decarbonisation. That lens remains essential. But recent events underline a second, equally important reality: security of supply and affordability are inseparable from the structure of the energy system itself.
Insecurity by design and by price
This shock is not the result of excess demand or speculative exuberance. It is being driven by physical disruption: constrained shipping routes, damaged infrastructure and heightened geopolitical risk. When prices rise for these reasons, the effects propagate quickly: higher inflation, volatile power prices, pressure on industrial competitiveness and emergency fiscal intervention.
Governments can release strategic reserves or subsidise bills but these measures treat the symptoms rather than the cause. An energy system dependent on imported fuels, long supply chains and a small number of transit routes is inherently insecure. It is also increasingly expensive.
Fossil fuels are no longer just carbon‑intensive. They have become a persistent source of macroeconomic risk. In the UK and across Europe, electricity prices still rise and fall with global gas markets, even as renewable generation expands. The volatility belongs to the fuel, not to electrification.
Challenging the wrong narrative
Against this backdrop, the claim that electrification is inherently expensive deserves scrutiny.
Fossil-fuel systems appear cheap because much of their cost is hidden until it arrives suddenly. Boilers and power stations may be relatively inexpensive to build but their economics depend on a continuous flow of fuel whose price is set internationally and can change overnight. When shocks occur, those costs are transmitted directly to consumers and industry.
Electrified systems operate on a different logic. Renewable generation is capital‑intensive upfront but has near‑zero marginal cost once built. Its economics are driven by financing and asset life, not by fuel prices or geopolitical risk. Over time, that makes costs more predictable – and energy security stronger.
If electricity prices remain elevated, it is not because electrification is expensive. It is because electricity markets remain partially anchored to gas, which continues to set marginal prices even as renewables supply a growing share of power.
Why batteries are now a security infrastructure
The most common objection to electrification is intermittency. Wind does not always blow, the sun does not always shine and fossil fuels are assumed to provide the dependable backstop.
That assumption increasingly misrepresents reality.
Grid‑scale batteries have moved from novelty to critical infrastructure. They respond in milliseconds, provide frequency control, manage peaks and absorb volatility at a speed no thermal plant can match. Crucially, they allow low‑cost renewable electricity to be stored and released when it is most valuable, reducing reliance on gas precisely at moments of system stress.
From an energy‑security perspective, this matters. Batteries are domestic assets. They are not exposed to international shipping routes, fuel embargoes or geopolitical leverage. Their cost curves continue to fall, while the risk premium embedded in fossil fuels continues to rise.
In security terms, flexibility is no longer optional. It is the mechanism through which electrified systems remain reliable under stress.
Redefining reliability
Reliability is often conflated with familiarity. Fossil fuels are considered reliable because they have powered energy systems for decades. Yet recent history suggests the opposite. Fuel supply has become one of the least reliable components of modern energy systems, exposed to conflict, trade disruption and deliberate constraint.
Electrified systems, when paired with sufficient storage and network capacity, are less exposed to those risks. Their failure modes are technical rather than geopolitical – and therefore more predictable, more insurable and more manageable.
That distinction is now central to energy security.
The UK test: ambition versus delivery
The UK illustrates this shift clearly. The creation of the National Energy System Operator, reforms to grid connections and the government’s clean flexibility agenda reflect a growing recognition that a renewables‑led power system cannot be secure without significantly greater flexibility. Reducing exposure to volatile gas prices is now an explicit national‑security objective, not simply a climate one.
What remains uncertain is whether delivery will match intent.
If the UK is serious about energy security, three priorities follow. Grid connection reform must be accelerated. Market design must reward system value, not just installed capacity. And batteries and other flexible assets must be treated as core security infrastructure, not ancillary services.
These are pragmatic steps, not ideological ones. They reflect lessons already learned through repeated energy shocks.
History suggests that energy crises often accelerate structural change. The oil shocks of the 1970s reshaped energy policy for decades. The question now is whether this shock produces a comparable reassessment.
In an increasingly unstable world, fossil fuels are no longer the conservative option. They are both more expensive and less secure than electrification. The real test for energy policy is whether systems are designed for that reality – before the next shock makes the choice unavoidable.
Alex O’Cinneide is executive officer at Gore Street Capital, the investment adviser to Gore Street Energy Storage fund plc. The views expressed above should not be taken as investment advice.