At the mercy of oil: A century of dependence and today’s global crisis

Oil tankers have been waiting for days. Somewhere along the narrow stretch of water that connects the Persian Gulf to the wider world, negotiations were not about diplomacy or peace, but passage.

Reports indicate that amid rising tensions in the ongoing US–Iran conflict, Iranian authorities have been charging as much as $2 million to allow ships to cross the Strait of Hormuz. The ships, by most accounts, are paying. Not because they agree, but because they must.

Oil, in today's world, leaves little room for refusal.

This dependence did not emerge overnight. It is the result of a century-long transformation that has reshaped not only economies but the very structure of modern life. In the early 20th century, before the outbreak of World War I, oil was marginal, a supporting player in a world powered almost entirely by coal.

Around 1910 to 1914, global oil consumption stood at roughly 1 million barrels per day. It was used primarily for kerosene lamps and as a lubricant for industrial machinery. The internal combustion engine was only beginning to take hold; Henry Ford's Model T had just been introduced in 1908, hinting at a future that few could yet fully grasp.

Even then, there were early signs of oil's strategic potential. In 1912, Winston Churchill made a decisive move to transition the British Royal Navy from coal to oil, recognising that oil offered faster speeds and more efficient refuelling. That decision quietly marked the beginning of oil as a geopolitical instrument, one that would shape conflicts, alliances, and economies for decades to come.

At the time, the US dominated both production and consumption, accounting for between 60-70% of global supply. Beyond a handful of industrial powers in Europe and Russia, oil remained a limited resource serving a limited need.

A century later, the scale is almost incomprehensible. Today, the world consumes more than 102 million barrels of oil per day, a 10,000%  increase from the pre-World War I era. The US alone uses around 19 million barrels daily, accounting for roughly 18–19% of global consumption. China follows at approximately 16.4 million barrels per day, with India consuming about 5.5 million. Together, these three countries account for over a third of all oil burned on Earth.

The reasons for this surge are embedded in how modern societies function. Transportation – cars, trucks, ships, and planes – historically drove demand, fuelling decades of growth. Yet in recent years, that growth has slowed. The real engine of rising oil consumption today lies elsewhere: in the petrochemical industry.

Oil is no longer just fuel; it is material.

From the plastic casing of a smartphone to the sterile packaging of medical equipment, crude oil underpins the production of countless everyday items. Hospitals rely on oil-derived products such as IV bags and syringes. Food systems depend on plastic packaging that extends shelf life and enables global distribution. Even the keyboards we type on trace their origins back to petrochemicals.

Agriculture, too, is inseparable from oil. Modern farming depends on petroleum not only to power machinery like tractors and harvesters but also to produce synthetic fertilisers and pesticides. In a very real sense, global food security is tied to fossil fuels.

Today, the world consumes more than 102 million barrels of oil per day, a 10,000% increase from the pre-World War I era. The US alone uses around 19 million barrels daily, accounting for roughly 18–19% of global consumption. China follows at approximately 16.4 million barrels per day, with India consuming about 5.5 million.

Infrastructure tells a similar story. Asphalt, the substance that binds together millions of miles of roads worldwide, is a direct byproduct of crude oil refining. Without it, the physical framework of modern transport would begin to unravel.

And then there are the invisible systems — the global supply chains that sustain contemporary life. Goods ordered online travel across oceans on ships powered by bunker fuel and arrive via cargo planes running on jet fuel. Every link in this chain reinforces the same reality: oil is not optional — it is systemic.

This is what makes the situation in the Strait of Hormuz particularly telling. The willingness of shipping companies to absorb multimillion-dollar costs for safe passage reflects more than a short-term crisis. It reveals the depth of a dependency that leaves little room for alternatives, even in the face of geopolitical risk.

Compared to a century ago, when oil played a relatively modest role in daily life, today's reliance is absolute. What was once a commodity for lighting lamps has become the foundation of transportation, manufacturing, agriculture, and global trade.