Dubai, UAE — The conflict in the Middle East has disrupted production and trade in hydrogen-based products, exposing vulnerabilities in global supply chains that support fertiliser production, refining and chemicals manufacturing, the International Energy Agency has said.
In its latest Global Hydrogen Review, the IEA said the crisis had renewed interest in hydrogen and hydrogen-derived fuels as tools to strengthen long-term energy security, although low-emissions hydrogen production remains too limited to provide an immediate response.
The report showed global hydrogen demand exceeded 100 million tonnes in 2025, while production of low-emissions hydrogen rose 20% year-on-year to almost one million tonnes.
Despite the growth, the agency said high costs, uncertain demand, regulatory complexity and insufficient infrastructure continue to slow development of the sector and place many government targets for 2030 at risk.
“The current crisis has highlighted how deeply economies around the world depend on trade in hydrogen-based products — from fertilisers to fuels and industrial feedstocks — and the significant role of the Middle East in those supply chains,” said Fatih Birol.
“Countries are looking for ways to make their energy systems more resilient and diversified. Low-emissions hydrogen can play an important role in those efforts over time, but stronger policy support and much faster deployment will be needed before it can make a meaningful contribution at scale,” he added.
The IEA said the pipeline of announced low-emissions hydrogen projects expected by 2030 had shrunk by about a quarter over the past year to 27 million tonnes due to delays and cancellations.
Projects that have either reached final investment decisions or have a strong likelihood of becoming operational by 2030 fell to just over six million tonnes, down from 10 million tonnes in last year’s assessment.
The agency said weak demand remained the sector’s biggest challenge.
New offtake agreements for low-emissions hydrogen remained broadly unchanged in 2025 from the previous year, while only about 20% of newly contracted volumes were backed by firm commitments.
Developers continue to cite uncertainty over future demand as one of the largest barriers to investment, the report said.
The IEA added that hydrogen could support industrial development, strengthen food security through domestic fertiliser production and help African countries move further up industrial value chains, including steel production.
However, it said achieving those benefits would require lower financing costs and closer integration of hydrogen strategies with broader economic development plans.
