2025 Energy Crisis: AI Demand and OPEC+ Flood Reshape Global Markets
The global energy landscape faced major upheavals in 2025. Oil prices crashed by nearly 30% after OPEC+ flooded the market with extra supply. Meanwhile, soaring demand from AI data centres pushed electricity grids to their limits and sent fossil fuel use to record highs.
In the US, Energy Secretary Chris Wright spearheaded sweeping policy changes under President Trump’s second term. These included forcing old coal plants to stay open, ramping up gas exports to Europe, and launching a massive AI-focused power expansion plan.
The year began with a sharp oil price collapse. OPEC+ members increased production significantly, triggering a near-30% drop in crude prices. The move sent shockwaves through energy markets already grappling with shifting demand.
At the same time, the rapid expansion of AI data centres created unprecedented pressure on power systems. Electricity demand surged, leading to higher bills for consumers and strain on regional grids. Natural gas became the go-to fuel for new generation, further tightening supply chains for raw materials. US fossil fuel consumption hit all-time highs, defying earlier predictions of a peak. Coal plants in states like Michigan and Indiana—slated for retirement—were kept running under Secretary Wright’s directives. His policies also prioritised US liquefied natural gas (LNG) exports, which grew by 25% in 2025, cementing America’s role as the world’s top supplier. The end of green energy subsidies under the Inflation Reduction Act (IRA) had immediate effects. New electric vehicle sales plummeted, and Ford recorded a $19.5 billion write-down. Wright’s push against EU methane regulations also intensified, as he promoted US fracked gas as a cleaner alternative for Europe. Beyond fossil fuels, the AI boom triggered a scramble for critical minerals. China’s restrictions on rare earth exports forced the US and other Western governments to secure their own supplies. Wright’s ‘KI-Aktionsplan’—a sweeping AI power initiative compared to the Manhattan Project—aimed to fast-track modular nuclear reactors and other high-capacity energy solutions.
The combined effects of OPEC+’s oil surge, AI-driven power demands, and policy shifts reshaped energy markets in 2025. Fossil fuel use climbed to new records, while the US solidified its dominance in global LNG trade. With grids under strain and mineral supply chains tightening, the year marked a turning point in how energy is produced, traded, and consumed.
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