"Imagine Iran Had Been Integrated Into The Modern World Instead Of Declaring War On The Modern World" With Dr. Dan Yergin

Today we had the honor of welcoming back Dr. Dan Yergin, Vice Chairman of S&P Global and Chairman of CERAWeek. Dan is a Pulitzer Prize-winning author, one of the most respected voices in energy, and a longtime authority on the intersection of energy, geopolitics, and the global economy. He is also the author of The Prize, The Quest, and The New Map, books that have helped shape how the industry understands energy history, markets, and geopolitical risk. With CERAWeek kicking off on March 23, we were delighted to hear Dan’s latest insights on the evolving energy landscape, along with a preview of the key themes and conversations likely to shape this year’s conference (current agenda available here).
 
Our conversation began with Dan’s perspective on how recent events in Iran have dramatically changed the backdrop heading into CERAWeek, and why the market may have been too complacent in the early days of the disruption. Dan shares his view that bad policy is often made under duress, reminds us that oil prices were already moving higher during the Gulf buildup, and explains why this moment should be viewed through a broader lens than just the formal start of the conflict itself. We explore the themes likely to shape CERAWeek this year, including the growing convergence of energy, power, and tech, the role of gas and electricity in the AI buildout, the importance of critical minerals and copper, infrastructure and permitting, nuclear, and the future direction of upstream oil and gas. We touch on Europe’s continued energy vulnerability, the renewed importance of U.S. LNG, the prospect of Europe once again competing with Asia for cargoes, the unique risks that LNG faces through the Strait of Hormuz, and the broader implications for global gas markets. We discuss the range of outcomes for Gulf production shut-ins, why U.S. producers are unlikely to react to short-term price spikes, how insurance, freight costs, and physical security are shaping traffic through the Strait, and what the performance of the U.S. and Israeli militaries indicates about the scale of planning behind this operation. We also look at the longer-term questions underneath the current crisis, including the changing role of Gulf capital, the infrastructure limits around the Strait, the historic arc of Iran’s posture in the region, and why the convergence of tech and energy may be one of the most important and constructive forces shaping the industry today. As always, it was an insightful and thought-provoking discussion. Many thanks to Dan for sharing his perspective and time with us all.
 
Mike Bradley started the show by noting that the market conversation this week has once again been focused on U.S. strikes against Iran and the short- and intermediate-term fallout across commodities and equities. In crude, he highlighted that WTI has moved from the mid-$60s/bbl before the war to ~$85/bbl, after peaking near $120/bbl on Sunday night into Monday morning. The effective shutdown of the Strait of Hormuz has been the main driver for global oil prices, with Iraq, Kuwait, and Saudi Arabia cutting production by 5–7 mmbpd due mostly to onshore oil storage constraints. WTI fell roughly $10/bbl in Tuesday’s trading due to rumors of a potential coordinated global SPR release of 300–400 million barrels. This war in Iran, at this point, should be viewed differently than the Ukraine war from an oil, natural gas, and economic standpoint. Global oil prices peaked about one month into that conflict, EU natural gas prices peaked roughly six months in, and economic stats such as U.S. CPI and PPI were significantly higher than today, so the pain threshold heading into this war seems more manageable. On the Energy equity front, the Energy sector is flattish since the Iran war started, significantly underperforming oil prices, with investors choosing not to chase energy equities with the move h