The global energy crisis has intensified in 2025, with nations grappling with soaring prices and acute resource shortages. In the United States, electricity generation reached record levels, increasing by 2% from the previous year. This surge was driven by heightened demand from data centers, businesses, and households. Clean energy production rose by 3%, elevating its share in the power mix to 45%, while fossil fuel generation also saw a 2% increase. Notably, solar output surged by 34%, offsetting a 4% decline in natural gas usage due to high prices, which led to an 18% rise in coal-fired production. Consequently, the national average retail electricity price climbed by 4% to 13 cents per kilowatt-hour, with states like Hawaii experiencing costs as high as 37.6 cents per kilowatt-hour. This upward trend in electricity rates is expected to continue, particularly during peak summer months, as utilities invest in infrastructure to meet growing demand.
In Europe, the energy crisis has reached a critical juncture. Gas storage facilities are at just 48% capacity, significantly below the EU’s target of 65% for this time of year. Analysts warn that if current consumption patterns persist, reserves could be depleted by mid-March. Germany, Europe’s industrial powerhouse, is striving to boost imports from Norway, but planned maintenance on Norwegian gas fields is expected to reduce output by 5–7% during the summer of 2025. The gas shortage is severely impacting industrial sectors in countries like France and Italy, with companies such as Arkema considering relocating production to countries with more affordable energy costs. Gas prices have reached unprecedented levels, with benchmark futures climbing to €58.75 per megawatt-hour by February 2025, and projections suggesting prices could soar to €70 by summer 2025.
In Cuba, the energy crisis has led to widespread power outages and fuel shortages, compelling families to adopt innovative solutions to maintain daily routines. Residents have turned to charcoal stoves for cooking after government-supplied gas was cut, and some have constructed makeshift televisions powered by motorcycle batteries. The crisis is exacerbated by aging infrastructure and insufficient power supply, with demand increasing from 2,580 MW in March to 3,050 MW in May, while supply has only marginally improved. The Cuban government has acknowledged the issue and is seeking support from countries like China and Russia to repair generators and develop solar parks, but progress has been limited.
In Iran, the energy crisis has led to severe power shortages, with government offices operating partially or closed entirely, and schools and colleges transitioning to online learning. The power shortage has resulted in shutdowns across 23 Iranian provinces, highlighting the country’s ongoing energy challenges.
The International Energy Agency (IEA) has projected that global carbon emissions from energy will peak in 2025, marking a historic turning point in the transition away from fossil fuels. This projection is attributed to increased government spending on clean energy in response to the crisis, particularly following Russia’s invasion of Ukraine.
In response to the crisis, OPEC+ has shifted its strategy from production cuts to restoring supply. Eight key members, including Saudi Arabia and Russia, are increasing output by 411,000 barrels per day in July, following similar hikes in previous months. This decision aims to stabilize the oil market, which has seen prices fall to around $65 per barrel, down from $101 in 2022. Analysts forecast that all 2.2 million barrels per day of voluntary cuts may be reversed by September 2025.
In the United States, over $14 billion in clean energy projects have been canceled or delayed in 2025. This setback is attributed to policy uncertainty arising from proposed tax legislation that threatens to weaken clean energy tax credits established under the 2022 Inflation Reduction Act. The cancellations have led to the loss of approximately 10,000 clean energy jobs, with significant impacts in states like Arizona, South Carolina, and Michigan.
These developments underscore the multifaceted challenges posed by the deepening energy crisis, affecting global energy markets, economic stability, and the transition to sustainable energy sources.
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