Energy Security Is Statecraft: Why Resilience Cannot Be Left to the Market
Energy security is no longer a commercial question. It is a question of statecraft, and resilience is a job markets were never built to do.
For much of the past thirty years, many governments treated energy as a market matter. Supply would find demand, and price would settle every imbalance. That assumption has not survived the past decade.
We have watched energy used as an instrument of coercion: supply withheld, prices manipulated, dependence turned into leverage. Undersea infrastructure has been sabotaged in peacetime, commercial shipping has been attacked in vital sea lanes, and state and criminal actors have probed the control systems of pipelines and terminals.
None of these were market events. Each was a security event that showed up in the market, and the market, by design, was not equipped to respond.
Every chokepoint is a target
Energy is not just a resource. It is a delivery system, and delivery systems have weak links.
Take Port Fourchon, a small port on the Louisiana coast that few outside the industry have heard of. It is the logistics base for a large share of America's offshore Gulf production. One hurricane closing that one port can disrupt an entire region's output, and what nature does by accident, an adversary can do by design.
In the Gulf, the stakes are larger still. A substantial share of the world's seaborne oil and LNG passes through a handful of narrow straits. Geography concentrates risk, and concentrated risk invites exploitation.
The threat picture keeps widening:
• Physical disruption of shipping lanes, terminals and undersea infrastructure
• Coercive supply politics, where exporters use access as leverage
• Cyber intrusion into the systems that control the flow of energy
• New dependencies in critical minerals and components, often concentrated in a few hands
The energy transition will not end this competition. It will redraw its map.
Buffers decide outcomes
When the European gas crisis struck, the difference between states was not market access. It was who had storage, diversified suppliers, regasification capacity and long-term agreements in place before the emergency began.
Those without buffers entered a bidding war against every other state facing the same emergency, at the same moment, for the same cargoes. They paid whatever was demanded or went without, and some paid in industrial output and political stability.
The lesson is simple: in a crisis, energy already in place is worth far more than energy that must be bought.
Forward positioning of LNG is a strategic imperative
LNG is now a pillar of the global energy system. It is flexible and mobile, and a cargo can be redirected across oceans in days. That flexibility is its commercial strength and, in a crisis, its strategic weakness: the cargo that can be redirected to you can just as easily be redirected away, to whoever pays more.
Forward positioning means holding LNG supply inside local markets: in storage, in regasification capacity and in strategic reserves near the point of consumption. The energy is ready before a disruption, rather than sought after one.
When a strait is closed, a pipeline is cut or a supplier turns supply into leverage, a prepared state is not negotiating from scarcity. It is acting from strength.
That makes forward-positioned energy a form of deterrence. A coercive cutoff loses its force when the target can wait it out.
This is the job of governments, not traders
Commodity traders do valuable work. They move cargoes efficiently, provide liquidity and connect supply with demand around the world.
But their horizon is the day, the month, the quarter and the year, and their obligation is to their profit and loss. That is not negligence. It is their mandate.
Resilience does not pay on that timeline. A strategic reserve may sit untouched for years: to a trading desk, that is stranded capital; to a state, it is insurance, deterrence and defence.
No government would let its military readiness depend on turning a quarterly profit. No intelligence service would close a monitoring station because it had been quiet for a year. Energy resilience is the same kind of public good, and it must be planned, funded and held by the state, because no one else has the incentive or the mandate to hold it.
Markets optimise for efficiency. States must provide for security. When the two diverge, as they always do in a crisis, the state cannot outsource its responsibility.
What it takes
Intelligence services should treat energy supply chains as a standing priority, not an occasional economic concern. That means early warning on chokepoints, coercive intent and threats to physical and cyber infrastructure, delivered to decision-makers in time to act.
Diplomacy builds energy security long before a crisis tests it. That means long-term agreements with reliable partners, diversified sources and routes, and frameworks for allies to share reserves and jointly protect maritime and undersea infrastructure.
Together, governments must:
• Secure supply in advance through long-term contracts and strategic reserves
• Build storage and regasification before it is needed
• Diversify suppliers, routes and technologies so no single actor holds leverage
• Protect the people and systems that keep energy moving
• Coordinate across borders, because supply chains cross them
The next crisis, not the next quarter
Some will argue that reserves cost too much, that markets will adjust, that the next crisis is unlikely. But crises are not unlikely. They are inevitable, and the only question is whether we meet them prepared.
History does not judge states by how efficiently they traded in calm waters. It judges them by whether they were ready when the waters turned.
Markets will always look to the next quarter. Governments must look to the next crisis.