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IEA chief Fatih Birol declares the start of the global age of electricity

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The 19th IICEC Conference, organized by the Sabancı University Istanbul International Energy and Climate Center (IICEC), was held at the Sabancı Center under the title “The Present and Future of Energy Security in the World and Türkiye: Risks and Solutions in Critical Minerals.”

The conference, which was attended by Harici Media and where global and regional energy dynamics were discussed, featured opening speeches by the Republic of Türkiye Minister of Energy and Natural Resources Dr. Alparslan Bayraktar, Sabancı University Founding Chair of the Board of Trustees Güler Sabancı, and International Energy Agency (IEA) Executive Director Dr. Fatih Birol.

IICEC Director Bora Şekip Güray shared the prominent findings of the “Türkiye Critical Energy Minerals Outlook 2025” report at the event, revealing the strategic importance of critical minerals in the energy transition through data.

“Geopolitics has descended on the sector like a dark cloud”

Taking the podium, IEA Executive Director Dr. Fatih Birol began his speech by drawing attention to the pressure of the current conjuncture on the energy sector before detailing the seven main headings affecting world energy markets.

Stating that energy and geopolitics have been intertwined throughout history, but that today’s picture differs from past crises, Birol defined the situation with the following expressions:

“I want to talk about a subject that, even if it is not directly related to energy, affects energy a lot these days. That is geopolitics coming over the world energy sector like a dark cloud. We have experienced oil crises, we have experienced natural gas crises, but there has never been a period where they all came together and geopolitics affected the energy sector this much. We see this simultaneously in oil, natural gas, and critical minerals.”

Emphasizing that a fundamental change is taking place in the world political system, that long-standing alliances are loosening or dissolving, while surprise new alliances are being born between countries, Birol said, “The dark and long shadow of geopolitics over energy makes itself felt to energy decision-makers every day. Energy security will be even more important in the coming years.”

The “American Five” effect on oil

Recalling that their forecasts for oil markets last year were confirmed, Birol stated that their predictions that supply would increase and prices would fall have come true. Birol said there are two main reasons for this relief in oil markets:

“First, demand growth is slowing down, especially due to China-related reasons. Second, and a very simple one; a massive amount of oil production is entering the market from what I call the ‘American Five’: the United States, Canada, Brazil, Argentina, and Guyana. This large production coming from these non-OPEC countries and weak demand means prices go down.”

Pointing out that oil prices have regressed from the $80 levels to the $60 levels at a time when geopolitical tensions have peaked and conflicts in the Middle East, Russia-Ukraine, and Latin America continue, Birol evaluated: “If there are no major surprises, we may see oil markets at these levels in 2026 as well. Because there is a lot of oil in the market.”

Birol noted that the most critical factor determining the course of oil demand in the long term will be the speed of electrification in the transport sector, as transport alone represents 45% of global oil consumption.

“The natural gas market will turn into a buyer’s market”

Heralding that a much more comfortable period has been entered for consumers in natural gas markets, Birol announced that the amount of LNG (liquefied natural gas) that will enter the market in the next five years is equivalent to half of the gas that has entered the market in the last 40 years. Stating that a massive gas supply of 300 billion cubic meters, especially from the US, Qatar, and Canada, is on the way, Birol explained the changing market dynamics with these words:

“75% of this incoming gas is what we call ‘flexible’ gas, which has no destination restrictions. In other words, there is no obligation to go from country A to country B; whoever pays the money will get it. Natural gas markets were a seller’s market for many years; now they will turn into a buyer’s market and the hands of the buyers will be strengthened.”

“China is still insistent on coal”

Evaluating the coal markets, Birol stated that while consumption is falling rapidly in some countries, production continues in others.

Recalling that 65% of the world’s coal consumption stems from China alone, and the remaining 35% is the sum of all other countries, Birol said, “Coal actually means China. China is still insistent on this issue. There is a slight increase in coal in the US with the rise in domestic natural gas prices, but the decline continues in the rest of the world. We predict that this horizontal course will continue for a few more years.”

“The world is officially entering the age of electricity”

Devoting the most comprehensive part of his speech to the explosion in electricity demand, Birol declared that the world has entered the “age of electricity.”

Explaining that electricity demand, which grew twice as fast as total energy demand in the past 10 years, will grow six times faster than energy demand in the next 10 years, Birol detailed the three new triggers behind this massive increase:

Artificial intelligence and data centers:

“Artificial intelligence may be the most consequential technological invention humans have found so far. Artificial intelligence means data centers. A medium-sized data center consumes as much electricity as a city of 100,000 people. Data centers are popping up like mushrooms all over the world. Two things will determine the competition between countries: Who is ahead in technology and who has electricity?”

Stating that China is ahead of Europe and the US regarding electricity infrastructure, Birol explained the difference in the supply chain with this example: “If you order a transformer or a gas turbine in Europe or America today, they say ‘don’t come before 2030.’ In China, you can get it two weeks later.”

Air conditioning use:

Stating that the second major trigger is the use of air conditioning, Birol said that demand for air conditioning has exploded in countries with increasing income levels and due to the effect of climate change.

Birol said, “While 90% of homes in America and Japan have air conditioning; it is at the level of 5% in Nigeria and 20% in India and Indonesia. As welfare increases in these countries, the number of air conditioners will also increase and this will push up electricity demand.”

Electric vehicles and the transformation in automotive:

Stating that the automotive sector is experiencing a historical transformation, Birol emphasized that China has now risen to the position of the world’s number one automobile manufacturer. Stating that 5 out of every 10 vehicles produced in the world are manufactured in China, Birol drew attention to the increase in the market share of electric vehicles:

“Five years ago, 5 out of every 100 cars sold in the world were electric. This year the rate rose to 25%. The new market is no longer rich countries; it is developing countries such as Asia and Latin America. With this transformation, we may see some leading companies that have dominated the sector for years experiencing serious economic shocks.”

Birol stated that renewable energy will play the leading role in meeting this increasing electricity demand, and that more than 85% of the new power plants installed in the world in 2025 will consist of solar, wind, and other renewable sources.

“Nuclear is one of Türkiye’s indispensable technologies”

Recalling that the IEA predicted three years ago that nuclear would return, and that they made this prediction despite the “wind blowing from the opposite direction” at that time, Birol announced that 2025 will be the year in which the all-time record for nuclear electricity generation will be broken.

To explain that the interest in nuclear has materialized, Birol gave three examples from his program in January:

“In the first week of January, I will go to Japan to discuss the opening of the power plants that were closed after Fukushima. The Japanese government wanted to get our views, especially for the commissioning of the 8 GW facility, which is the world’s largest nuclear power plant. The following week, I will go to Stockholm to meet with the Swedish Prime Minister and King; Sweden wants to increase its 40% nuclear share even further and build new reactors. Thirdly, I have been the Chairman of the Energy Board at the Davos World Economic Forum for 11 years, and for the first time we will organize a special nuclear session in Davos. This became the most popular session.”

Giving full support to Türkiye’s nuclear energy strategy, Birol said, “Nuclear is one of Türkiye’s indispensable technologies. It is extremely important both in terms of meeting electricity demand, environmental emissions, and geopolitical weight.”

“There is a massive dominance of China in rare earth elements”

Stating that they established a critical minerals unit as an agency five years ago and allocated a significant part of their budget here, Birol stated that the IEA has a “good nose.” He emphasized that critical minerals are of vital importance not only for clean energy technologies but also for the defense industry, drones, and chips.

Stating that China is at least 10 years ahead of other countries in this field with both mining access and refining capacity, Birol revealed with the following data that the picture will not change in the short term despite the investments made by the Western world:

“China’s share in the global refining sector for rare earth elements is 92%. Even if all planned new projects in America, Canada, Australia, and Europe are implemented on time and in full, China’s share will only drop to 75% in 2035. So there is still a massive dominance. The refining sector is a dirty and difficult business; not everyone can easily establish it in their country.”

Recalling the export restriction introduced by China last April, Birol warned: “We have a saying in Turkish: ‘One misfortune is better than a thousand pieces of advice.’ That decision taken by China reminded everyone, especially the automotive sector, how serious this business is. A country that has such power behind it sits at the table much more comfortably than others.”

“Climate change is a worrying but temporary trend”

In the final part of his speech, Birol touched upon climate change, stating that 2025 is the second hottest year in the world, and the severity of extreme weather events such as forest fires, droughts, and floods has increased.

However, stating that the place of climate change on the agenda of world leaders has shifted downwards due to geopolitical tensions, Birol described this situation as a worrying but temporary trend.

Stating that he finds Türkiye’s candidacy for the COP31 presidency together with Australia “extremely appropriate,” Birol concluded his words as follows:

“I think that Türkiye hosting this organization is an important chance for our country and the world. My hope is that Türkiye will both bring climate change to the place it deserves on the world agenda and play a bridge role between developed and developing countries on financing. Türkiye has enormous resources in solar, wind, and geothermal; I believe that we will continue to take positive steps together with renewable energy and nuclear.”

Diplomacy

Defense Priorities director warns US air strategy in Middle East faces tactical limits

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The collapse of a tentative memorandum of understanding between Washington and Tehran, coupled with the diminishing strategic returns of American air power, has left the United States locked in an unsustainable, low-intensity conflict with Iran, according to Benjamin Friedman, Policy Director at the Washington-based think tank Defense Priorities.

Speaking in an interview on the YouTube channel Harici with host Sarp Sinan Hacır, Friedman attributed the failure of the short-lived US-Iran memorandum primarily to the Trump administration’s diplomatic missteps, vague draft language, and unrealistic expectations regarding a comprehensive settlement.

“Both sides really deserve some blame, but the Trump administration deserves the bulk of the blame for drafting an agreement that was so vague on key terms,” Friedman said, citing ambiguities surrounding the timeline for unfreezing Iranian assets and the scope of American commitments to restrain Israeli military operations in Lebanon.

Friedman emphasized that deep-seated mistrust in Tehran, exacerbated by repeated instances where diplomatic engagement was followed by Israeli or American military strikes, led Iranian negotiators to adopt an unyielding posture. At the same time, he noted that Iran likely miscalculated by using disruptions in the Strait of Hormuz to aggressively force leverage.

“The Trump administration remained intent on this sort of grand bargain that would restrain Iran seeking weapons development… and I think they continue to misread the Iranian willingness to sign that kind of deal,” Friedman noted, adding that Tehran viewed its leverage over the Strait of Hormuz as essential despite the risk of provoking further strikes.

Expressing deep skepticism over the prospects for a lasting diplomatic breakthrough, Friedman criticized the administration’s reliance on informal envoys such as Steve Bannon and Jared Kushner over professional diplomatic channels, predicting that the baseline outcome will remain an unpredictable, episodic conflict.

“What’s more likely is a kind of on-off-again kind of war—sort of what we’re in now, where we have occasional strikes, with the United States perhaps by accident adopting the Israeli model of ‘mowing the lawn’ periodically,” Friedman said.

Addressing the efficacy of US air power, Friedman argued that military operations against Iranian targets have reached a point of diminishing returns. While early strikes successfully eliminated critical high-value assets—such as over-the-horizon radar systems that targeted anti-ship missiles—Iran’s ballistic missile and long-range drone capabilities remain largely intact and operational.

He pointed to a recent strike on a base hosting US personnel in Jordan, launched from western Iran over a distance exceeding 1,000 kilometers, as evidence of Tehran’s sustained strike precision and the tactical limits of American interdiction efforts.

“The war is a failure for air power even in a tactical sense,” Friedman stated. “Initially, we looked at it and said we had a lot of success in destroying targets, but as more information came out, it turned out they had maybe more than half of their missiles and launchers survive the initial phase of the war.”

Friedman observed that the global proliferation of low-cost, high-precision guidance technology has permanently altered the strategic landscape, neutralizing the traditional invulnerability of forward-deployed US installations. “The precise effects of air power that used to be almost a monopoly of the United States… is actually making our posture in the region less sustainable,” he said, warning that similar vulnerabilities would be vastly amplified in any potential high-intensity conflict with China.

As an alternative to open-ended military engagement, Friedman suggested that Washington consider a complete military withdrawal from the region, even if it entails accepting Iranian transit fees on commercial shipping through the Strait of Hormuz. “The cost of preventing that through perpetual outbursts of warfare is much higher than just accepting it,” he noted.

Turning to regional dynamics, Friedman addressed Israel’s current absence from active strike operations against Iran, characterizing it as a calculated move to preserve its own air defense interceptors while relying on Washington to bear the operational and political burdens of containment.

On European security and the broader alliance structure, Friedman offered a critical assessment of the NATO summit in Ankara and the administration’s “NATO 3.0” concept. He described the white paper led by Defense Secretary Pete Hegseth as an effort to coerce European states into escalating defense expenditures and purchasing American hardware under the threat of reduced security guarantees, rather than executing a structured, strategic US posture adjustment.

“This is not a real US withdrawal; it’s a kind of pressure to up your loyalty in a particular way,” Friedman said, noting that major European powers such as Germany, France, and the UK lack a compelling existential incentive to construct independent, large-scale conventional war-fighting capabilities.

Regarding bilateral relations with Ankara, Friedman noted that US-Turkish tensions have eased considerably following the shift in American posture in Syria and progress toward resolving long-standing friction points, including the F-35 program and S-400 procurement. He added that while Israeli leadership under Prime Minister Benjamin Netanyahu has expressed frustration over Washington’s constructive engagement with President Recep Tayyip Erdoğan, the White House has maintained its strategic course despite pressure from domestic pro-Israel lobbying groups.

Addressing internal Republican Party dynamics, Friedman highlighted the evolving public stance of Vice President J.D. Vance, whose cautious criticism of Israeli influence and emphasis on divergent national interests reflects broader ideological shifts within the conservative base.

“Vance is more representative of the shift in the Republican Party,” Friedman said. “He’s criticizing them in a limited way and saying, ‘Our interests are different.’ From the perspective of those of us who would like the United States to have a more distant relationship from Israel, it’s progress.”

Looking ahead to the upcoming US midterm elections, Friedman anticipated that a loss of congressional control by the Republican Party would severely curtail the administration’s domestic executive overreach, though its structural impact on foreign policy execution and Middle Eastern operations would remain comparatively limited.

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UK Prime Minister Andy Burnham pledges full support to Ukraine in meeting with Zelenskyy

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UK Prime Minister Andy Burnham has met with Ukrainian President Volodymyr Zelenskyy in Portsmouth, England.

Zelenskyy is the first world leader Burnham has met in person since taking office, with the prime minister committing to building a “firm partnership” between the United Kingdom and Ukraine.

Demonstrating their support, the two leaders toured a military base in Portsmouth where 200 Ukrainian troops are currently undergoing naval training exercises.

Burnham described his meeting with the Ukrainian president as “warm” and said he plans to visit Ukraine soon.

“We will build this together and address the various issues President Zelenskyy is facing, many of which we discussed today,” Burnham said.

The meeting follows an announcement by London that it will share intellectual property rights to assist Kyiv’s war effort.

The new prime minister announced that the UK will share the “Stone Cloak” electronic warfare system—which is fitted to drones to prevent detection—and will assist Ukraine in mass-producing the technology.

Burnham has focused primarily on domestic matters since replacing Keir Starmer, who faced criticism from elements within his own party for spending too much time abroad and focusing heavily on foreign affairs.

However, Burnham sought to signal continuity in Britain’s policy toward Ukraine. In one of his first phone calls after becoming prime minister last week, Burnham invited Zelenskyy to visit the UK “as soon as possible.”

Starmer spent his final full day as prime minister in Kyiv, where he announced £255 million in funding for Ukraine.

Speaking to Sky on Monday, Zelenskyy said his telephone conversation with Burnham had been “very good.”

The Ukrainian leader noted that Starmer had previously assured him that “the new government would maintain the policy of supporting Ukraine during the war.”

The new prime minister told the Ukrainian leader it was “no coincidence” that he was his first international visitor since moving into Downing Street.

“The purpose of this is to send a very clear message. We stand 100% with Ukraine, I personally stand 100% with you, and I will fully deliver on every commitment this country has made to Ukraine,” Burnham said.

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Ukraine targets first prototype of European Freyja missile defense system in early 2027

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As Ukraine continues to lobby allies for new weapons capabilities to counter Russian missile strikes, the country aims to have a prototype of the Freyja anti-ballistic system, developed in partnership with European allies, ready in the first half of next year.

David Aloyan, deputy secretary of Ukraine’s National Security and Defense Council and director of the Freyja project, stated—as reported by Reuters—that an international steering committee tasked with calculating research and development costs will meet for the first time in the near future.

The anti-ballistic coalition was officially established two weeks ago at a summit held in the French capital, Paris. The summit was attended by leaders of 10 European nations, including Ukrainian President Volodymyr Zelenskyy, alongside roughly 12 defense industry contractors.

Providing details on the timeline, Aloyan said: “We have an ambitious goal because we are working on a very tight schedule. We aim to have a viable prototype that can show its first practical results in the first half of next year.”

Ukraine remains chronically dependent on US-made Patriot air defense systems, which are currently the only weapons capable of reliably intercepting Russia’s hypersonic and high-velocity ballistic missiles. However, Patriot deliveries have faced persistent disruptions driven by political fluctuations, low inventory levels, and extended production cycles.

The Russian military intensified its ballistic missile strikes this month against the capital, Kyiv, and the southern port city of Odesa. Facing salvos of dozens of missiles, Ukraine was unable to destroy the majority of incoming targets due to a severe shortage of interceptor munitions.

The Ukrainian government has indicated that it is prepared to contribute a launch vehicle and an interceptor missile to the Freyja initiative. In comments made this month, President Zelenskyy remarked that the project has now become purely a “matter of testing,” expressing hope that the system will become operational within a year.

Kyiv expects its allies to provide specialized expertise and technology in advanced radars, sensors, and missile guidance and control electronics. Defense contractors participating in the project include Eurosam—the consortium behind the SAMP/T system—as well as Leonardo, Thales, and Saab.

Fire Point, the Ukrainian missile and drone manufacturer that developed the Flamingo cruise missile, announced that it will serve as the primary industrial partner for the project. The company disclosed last month that it had reached an agreement with German defense producer Hensoldt to supply the radar components required for the initiative.

The Freyja project stands out as an effort to construct a lower-cost alternative to the Patriot system, on which many European nations also rely. Other European air defense assets, such as the Franco-Italian SAMP/T and the German-made IRIS-T, have not yet demonstrated sufficient operational capability in intercepting ballistic missiles.

Zelenskyy likened the operational framework of the Freyja coalition to a Lego arrangement, in which defense industry leaders assemble interconnected components.

Emphasizing the flexibility of the design, Aloyan noted that manufacturers have been tasked with developing a system architecture featuring interchangeable components, stating:

“The core logic of this system is that it possesses an open architecture. If Denmark says, ‘I want a Freyja system configured with a Danish-made Weibel radar,’ that is possible. If Sweden states that it wishes to integrate a Saab system, that presents no issue either.”

Aloyan added that establishing a dedicated administrative body or fund to direct all project contributions and secure stable, continuous financing remains among the options under consideration.

The Ukrainian official stressed that direct corporate participation alongside sovereign governments would streamline bureaucracy, concluding: “The coalition must advance on practical grounds rather than political ones.”

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