A Barer New World
What a Disruption Reveals About the Economy We Still Haven't Built
The ground that we stand on is shifting. And I’m not referring to the recent earthquake in the Molucca Seas. The shift is economic and it is not just about petrol prices at the pump. At the risk of stating the obvious, petroleum is not just fuel. It is also fertiliser, which is the foundation of modern agriculture. And it is plastic, which is a ubiquitous material in almost all aspects of modern manufacturing and consumer goods. It is the backbone of chemicals, packaging, logistics, and even parts of modern medicine. When supply tightens, the effects cascade across almost every layer of daily life. And if the tensions around Iran drag on, we are not looking at a temporary spike. We are looking at sustained pressure. Things will not just get expensive, but scarce.
Modern life is, in many ways, a petroleum story. Food production relies on fertilisers derived from natural gas. Consumer goods depend on petrochemical inputs. Transportation, obviously, is fuel-driven. Even the invisible systems — logistics networks, cold chains, packaging — are all deeply oil-dependent. We rarely notice this because abundance has always been the baseline. We might want to pay deeper attention now.
Sarawak, at first glance, appears relatively insulated. With roughly 70% of our energy coming from hydroelectricity, we might assume we are better positioned than most. That assumption would be perilously incomplete. Our electricity may be renewable, but our economy is not. Our supply chains, our consumption patterns, and our business models remain tightly intertwined with petroleum. We import some 60% of our food. We are not as exposed as others but we have no immunity.
There will be echoes of the Covid era. Reduced travel, more remote work. A subtle shift towards frugality. Working from home becomes an economic response. Every avoided commute is fuel saved. Traffic jams becomes painfully wasteful. But this is not Covid. Covid was a temporary disruption with an assumed return to normal. This is different. This might not be about waiting for things to go back.
The real danger is not just rising costs. It is the mismatch between costs and income. If petroleum-linked prices rise faster than wages and business revenues, affordability will be severely threatened. And the impact could be abrupt. Certain goods will simply fall out of reach. Businesses that rely on cheap inputs will find their margins squeezed. Consumers will cut back, not by choice, but by necessity. Governments can cushion the blow through subsidies, policy adjustments, and strategic reserves. But there are limits to what the government can do. No government can fully shield an economy from a structural shift in global resource availability.
What is happening now might be ominous. What feels like a crisis today could, in fact, be seen as a preview.
By the laws of nature, petroleum will one day run out. And long before that, it will become increasingly expensive and difficult to extract. The age of easy oil does not end with a bang. It ends with rising cost curves.
What we are experiencing now is a compressed lesson in a future where vehicles must run on non-petroleum energy, where fertilisers must be produced without LNG dependence, where materials must be reused, recycled, or replaced, and where economies must become circular rather than extractive. This future has always been coming. This ‘preview’ is unpleasantly interactive.
So what should businesses do? The starting point is a shift in mindset. Businesses need to ask how dependent they are on petroleum-based inputs, which costs would spike first and by how much, and what happens if supply is disrupted rather than merely priced higher. From there, the responses begin to take shape.
Reducing dependence means redesigning processes to use less: less packaging, less transport, less energy-intensive production. Localising supply chains matters too. Global networks are efficient when fuel is cheap; they become fragile when it is not. Local sourcing, even at slightly higher cost today, may prove to be a strategic advantage tomorrow. Product design must also evolve: items that require fewer inputs, simpler materials, and longer lifespans will outperform those built on assumptions of abundance. And businesses that can reclaim, reuse, or repurpose materials will gain resilience precisely because waste is simply unused resource.
Perhaps most urgently, pricing must reflect reality rather than optimism. Many businesses are still pricing as if costs will normalise. While none of us want businesses to all increase prices all at once, that assumption grows more dangerous by the day. It is a precarious situation.
Most people are unprepared for this world, and that is precisely why opportunity exists, as painful as it might be. Entire industries will need to be reimagined: alternative fertilisers, low-energy manufacturing, repair and refurbishment economies, localised food systems, new materials to replace petrochemicals. Sarawak, with its energy advantage and relatively smaller economic scale, has a genuine chance to adapt faster than larger, more rigid systems. But only if we recognise the shift early.
It is entirely reasonable to feel frustrated by this external shock imposed by forces far beyond our control. The frustration should be directed to drive more constructive activities in this new reality. Under a more positive lens, while reluctantly so, we are being given a rare window: a moment where the weaknesses of our current system are laid bare, and the contours of the next system are becoming visible. The question is not whether less is coming. The question is whether we learn to do more with it before we are forced to.
As many dystopian sci-fi movies may tell you, the future is not fixed. Every day is an opportunity to write the next chapter of our society. Maybe this is the trigger we need to start knocking our heads together and think about how we can design it better.