Teck Resources' Highland Valley Copper Mine near Logan Lake, B.C., on Sept. 11.DARRYL DYCK/The Canadian Press
Swift action by an alliance of G7 nations to develop a critical-minerals supply chain will play a crucial role in ensuring the global security of supply, says the head of the International Energy Agency.
The G7 summit in Kananaskis, Alta., in June produced a plan among member countries that is focused on diversifying and strengthening production of the minerals vital to the global economy. Fatih Birol, the executive director of the International Energy Agency, said he will push for action on the agreement at the G7 energy and environment ministers meeting next week in Toronto.
China is the leading refiner and processor of the majority of the world’s 20 strategic minerals, according to an IEA analysis, and that should ring international alarm bells, Dr. Birol said Tuesday in an interview from Paris.
“Slowly but surely, countries’ governments are waking up to this looming security challenge,” he said.
Dr. Birol estimates that most of the world is about a decade behind China when it comes to critical minerals. Recent export restrictions imposed by the country highlight the importance of G7 countries and their allies working together to diversify and strengthen the supply chain, he said.
The effort to do so has been in the global spotlight in recent months. Last week, Natural Resources Minister Tim Hodgson was in London for a trip focused on strengthening the supply chains between Canada and Britain.
And on Monday, U.S. President Donald Trump and Australian Prime Minister Anthony Albanese signed a critical-minerals agreement at the White House in a US$8.5-billion deal between the allies aimed at curbing China’s power in the market.
Mr. Trump has also been making an increasing interventionist push into the Canadian critical-minerals sector, too, with the U.S. government recently acquiring stakes in two Canadian miners. Mr. Hodgson has brushed off national-security concerns about the deals, saying the positions are small and the U.S. is an ally.
Dr. Birol said his main wish for the G7 summit next week is that countries band together to try and shift market power in the critical-minerals sector away from from China.
If allies fail to act, he worries that the world “may be seeing a 1970s moment for critical minerals that we had for oil,” he said, referring to the global oil crisis that saw massive petroleum shortages and inflated prices as supplies were choked off.
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Also on the agenda for next week’s meeting is electricity policy.
Global demand for power has skyrocketed in recent years and it shows no sign of slowing down, owing to surging interest in artificial-intelligence data centres, the growing use of air conditioners and increasing sales of electric vehicles.
“We have never seen such a strong growth in such a short period of time,” Dr. Birol said, adding that the rise in electricity demand is forecast to be around six times higher than the increase in demand for energy over all in the coming years.
Solar, wind, hydropower, nuclear power and natural gas will all play a role in meeting that demand, he said, and he hopes robust discussions at the G7 table will lead to a common understanding and government policies that rise to the challenge.
When it comes to oil, Dr. Birol expects the main focus to be the looming supply glut.
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The IEA has for more than a year predicted a major surplus in global markets and downward pressure on prices, because of a combination of slowing demand and strong supply growth from the United States, Brazil, Canada and others.
“It is exactly what is happening today. In the middle of so much geopolitical tensions in the Middle East, Russia, Ukraine, trade wars between countries, prices are about $60 and going even below that,” he said.
Indeed, oil prices settled at their lowest since early May on Monday as investors weighed a potential global glut, with U.S.-China trade tensions adding to concerns about an economic slowdown and weaker energy demand.
“These glut fears are now descending onto the market, particularly looking forward into 2026. We will start to see floating storage pick up and inland tanks get filled,” John Kilduff, partner at New York-based Again Capital, told Reuters this week.
“This is a real bearish narrative that we have not seen in some time,” Mr. Kilduff added.
Next week’s G7 meeting will provide Canada with the opportunity to “show the world its energy muscles,” Dr. Birol said. While Canada punches “well below its weight” on the international front, he said, it can play an important role in global energy security.
With a report from Reuters