- Lessons learned from the ongoing Middle Eastern conflict
The intersection between energy and geopolitics has long been a flashpoint for global stability. Sri Lanka imports nearly 60 per cent of its energy needs, and a substantial portion of it is from the Middle East (ME). This dependency is an economic challenge and a critical national security vulnerability. The dependence on a particular region for energy needs leaves the country exposed to risks as seen with the ongoing conflict in the ME and their ramifications are felt throughout the economy at present. Sri Lanka has to secure its energy needs by navigating in an increasingly polarised world, amid geopolitical rivalries.
Energy weaponisation
The weaponisation of energy occurs when a state or an organisation manipulates the supply or price of energy resources to achieve political or military objectives. The most iconic instance occurred during the Arab-Israeli War of 1973 when the Organisation of Arab Petroleum Exporting Countries implemented an embargo against nations supporting Israel. Global oil prices quadrupled, shifting from US $ three to $ 12 per barrel overnight. This forced Western nations to establish strategic petroleum reserves and the International Energy Agency (IEA). Similarly, following the invasion of Ukraine in 2022, Russia significantly restricted natural gas flows to Europe, resulting in exceptionally high energy bills for households across Europe, adding a constraint on the global supply as added European demand for alternative sources drove up energy prices. Correspondingly, at present, the US-Israel war on Iran has limited the export of energy from the ME. The IEA Chief said on 21 April of this year (2026), “The conflict between Iran and the US and Israel is creating the worst energy crisis ever faced by the world”, highlighting the seriousness of the current situation.
Impact on SL
The escalation of hostilities in the ME has directly threatened Sri Lanka’s fragile economic recovery from the 2022 economic crisis. Brent Crude surging past $ 100 per barrel in early 2026 since the start of the conflict has forced retail price hikes of over 25 per cent by the Petroleum Corporation, and other fuel retailers. This has in turn resulted in rising costs of everyday goods and services across the country. The Government has outlined its approach to address rising costs in the energy sector by introducing a massive subsidy scheme worth Rs. 60 billion over the next three months. Under this plan, the Government will provide up to Rs. 100 per litre of diesel and up to Rs. 20 per litre of petrol as a subsidy. During the March 2026 fuel price revision, an official from the Energy Ministry cited the reason was the economic rationale, as the loss resulting from this subsidy would be less than the effects to the economy if the full prices were reflected at the pump. However, high fuel bills drain foreign reserves as petroleum imports regularly represent one of the largest components of the country’s import bill, often costing between $ four-six billion annually. Depending on global price movements and when oil prices rise, the import bill expands rapidly, widening the trade deficit and intensifying pressure on foreign exchange reserves.
Regional partnerships
To mitigate the effects against future energy weapons and regional volatility, Sri Lanka should be resilient and receptive to change. Sri Lanka must pivot towards regional partners such as India, who have proven their commitment to support the Island time after time. India’s humanitarian peace-building provides a salient example of how humanitarian peacebuilding contributes to strengthening bilateralism. Engaging in bilateral relations on energy transfers by developing an oil pipeline between the two countries, and cooperation in developing the Trincomalee Oil Tank Farm to support the energy capacity, highlighted by the Indian Foreign Secretary Shri Vikram Misri during the special briefing by the External Affairs Ministry on the visit of the Indian Vice President, are mutually beneficial for both Sri Lanka and India. This can generate new economic opportunities for both parties and help maintain energy security in the long run. Moreover, Sri Lanka should improve relations with Russia, and import energy products, since it is a major producer of energy commodities, as seen previously during 2022, to diversify relationships and avoid conflict of interests with other partner countries, safeguarding the autonomy of the country. The recent visit by Russian Deputy Energy Minister Roman Marshavin confirmed that Russia has agreed to supply fuel to Sri Lanka.
Renewable energy
Additionally, China’s investments and dominance in the renewable energy sector can be utilised by Sri Lanka to propagate solar and wind energy throughout the country. The Director General of the Sustainable Energy Authority commented that, “Previously, renewable energy was more expensive than fossil fuel in Sri Lanka, but the Chinese investments brought down the cost to unimaginably low levels. Within 10 years, the prices of a watt of photovoltaic (PV) solar dropped from $ five to Cents seven,” he added. The cost of electricity generation by coal stands at Rs. 22.23 per kilowatt hours (kWh) and the cost for furnace oil is Rs. 105.30 LKR per kWh, while the cost for ground mounted solar stands at Rs. 19.47 per kWh for individual power plants. Moreover, under a new framework effective from June 2025, the unit cost of rooftop solar was at Rs. 20.90 per kWh. Generating electricity from solar panels is economically lucrative as sunlight is a naturally occurring renewable phenomenon that virtually provides costless power once the infrastructure is installed and helps save $ used to import energy. Building-integrated PV and rooftop solar installations allow rooftops and facades to be used for congested areas as using existing structures reduces the overall resource requirement and land acquisition costs, and provides revenue generation and carbon reduction in the long term. The potential for solar energy is immense, especially for an Island nation like Sri Lanka. The Government’s current “Sooriyabala Sangramaya” initiative must be expanded and the capital cost to acquire solar panels must be reduced through incentives and subsidies, essentially leading to lowered electricity costs and reduced emissions. By lowering the cost of electricity, people will be incentivised to shift to electric modes of transportation, such as electric vehicles and bikes, reducing the demand for fossil fuels and their harmful effects on the environment.
Sri Lanka has over 250 megawatts of operational wind power capacity, largely concentrated in high wind zones such as Mannar, Puttalam and Kalpitiya its contribution to the actual energy mix is often higher during peak monsoon months. These projects utilise state of the art turbines which offer a significantly higher capacity factor than older models.
Sri Lanka possesses a massive, underutilised renewable energy resource that could provide a path towards energy independence, economic stability and meet international climate commitments. Hence, developing bilateral and multilateral relationships between countries on the import and export of goods, services and energy to improve existing deals, forge new deals, and diversify relations, with a particular emphasis on regional partnerships and a renewed focus on adopting and propagating renewable energy, are key to mitigating the effects of the use of energy as weapons of war for Sri Lanka to ensure energy security, which in turn ensures national security.
The writer is a research Intern at the Institute of National Security Studies think tank functioning under the Defence Ministry
-------
The views and opinions expressed in this column are those of the author, and do not necessarily reflect those of this publication