Cold War Two and Sustainability: How Geopolitical Risks Are Rewarding Efficiency
Article from MHI Solutions Magazine
ENERGY PRICES ARE significantly exposed to Cold War Two risks. The key takeaway for manufacturing and supply chain professionals is that the companies that insulated themselves by reducing their reliance on hydrocarbons ahead of the conflict with Iran to meet sustainability goals are poised to benefit asymmetrically in an environment of high prices and elevated risks.
OIL PRICES SURGED DUE TO CONFLICT
Oil prices surged sharply in March and April, following the onset of the U.S. conflict with Iran. In fact, the price increase has been among the fastest increases on record. At the retail consumer level, the rapid repricing of energy risk has sent AAA retail gasoline prices to $4.30 per gallon at the end of April 2026, up from $3.99 at the end of February 2026. This price was also sharply higher than $3.18 at the end of April 2025.
As a double‑edged sword, this fuel price shock threatens to compound upside inflation risks while also eroding consumer purchasing power, weighing on the growth outlook. The U.S. and global economic outlooks have darkened as a result of the conflict and higher oil prices. Growth risks are skewing downward, while inflation risks are moving higher. This is a stagflationary impulse driven by geopolitics…
