Pylyp Travkin: Rare earth metals have become the new oil

The rare earth metals market is experiencing a period of significant volatility and conflict, primarily caused by China's recent export restrictions. These restrictions, which took effect on October 1, 2024, have already led to an 8.33% increase in the prices of many critical resources.

This raw material has acquired enormous importance for national economies, as at one time fossil resources, which is why it was called the new oil, since the ability of a particular state to be among the world leaders in technology and in the military sphere critically depends on it.

Given China's dominance of this market, any policy changes affecting rare earth exports will have far-reaching global implications. The struggle for world domination is taking on a new character, much in the same way that the struggle for oil once fueled wars and attacks on resource-rich regions.

While efforts by the US to diversify its resource dependence against China in various areas continue, it will take time and significant investment to produce results. The rare earths and resource standoff is fueling an ever-increasing escalation that goes beyond economic and political methods, involving more and more countries.

China's export restrictions have significant geopolitical implications. Until new deposits are brought into operation in Latin America, Beijing, by controlling the supply of rare earth metals, affects international trade and can affect global economic activity. This situation emphasizes the need for all other countries to reduce their dependence on the PRC and secure their own supply chains of critical materials before the struggle escalates into new military conflicts and clashes.