For most of the last century, the world’s economic pecking order was decided by who controlled barrels of oil. That’s still true today, as the ongoing Iran war is showing in painful ways at the gas pump.
But a second, quieter contest is unfolding alongside it, and this one is being fought over electrons.
The countries, companies, and communities that can generate, move, and deliver electricity reliably are the ones that will set the rules for the rest of the decade.
Two Energy Shocks, One Squeeze
Americans are living through two energy stories at once. The first is familiar. Oil prices, pushed higher by the Iran war, are rippling into nearly everything we buy. The Consumer Price Index rose 3.8% in April, and higher energy costs were the biggest reason for the jump between March and April. Compared with the same month a year ago, energy costs are up 18%.
The second story is newer and harder to see. The boom in artificial intelligence is driving a sudden surge in demand for electricity to run data centers. Last week, the nation’s grid watchdog issued its highest level warning that this exploding demand could strain power systems.
Put together, these two pressures are turning energy into what Axios called “the singular driver of both global stability and economic growth.”
Why Electrons Matter More Than Ever
Oil mostly powers transportation. Electricity powers almost everything else, including the data centers training the artificial intelligence tools millions of Americans now use every day. In the United States, data centers are responsible for a much larger share of power growth than they are in the rest of the world, according to the International Energy Agency.
That makes electricity a strategic resource on par with oil. A country with plenty of cheap, reliable power can host the data centers, factories, and research labs that drive the modern economy. A country without it falls behind.
As Jason Bordoff, founding executive director of Columbia University’s Center on Global Energy Policy, put it: “Whether the issue is oil-supply disruption or power-sector strain, the lesson is the same. When energy is unavailable, unreliable or unaffordable, economies slow, public anxiety rises, and policymakers have little room to focus on anything else.”
The American Advantage, and Its Limits
The United States has one big buffer in this contest: domestic natural gas. Plentiful supplies mean American electricity is not directly affected by the war in the Middle East, at least for now. That is a genuine strategic edge.
But the buffer is not unlimited. Power prices are rising anyway, partly because data centers are pulling more electricity from the same grid that serves homes and small businesses. Households are now feeling the squeeze from two directions at once: the pump and the meter.
The Politics of Power
The political stakes are hard to overstate. Voter frustration with high power prices is starting to collide with frustration over high gasoline prices. Layer in worries that artificial intelligence could displace jobs, and you have the makings of a political moment that cuts across party lines.
“Rising energy prices and fewer jobs are making it harder for people to get by and could fuel a feeling that elected officials are not looking out for their interests,” Bordoff said.
The Bottom Line for the Decade Ahead
The next phase of the global economy will not be defined only by who has the most oil. It will be defined just as much by who can produce and deliver the most electricity, on time and at a price ordinary people can afford. From battlefields in the Middle East to data centers in the American heartland, the contest for energy has become the contest for everything else. Whoever controls the electrons will, in a very real sense, control the decade.
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