Oil Price Surge Hits Bitcoin Miners via BTC Price, Not Power Costs

Oil Prices Surged, But Mining Electricity Costs Barely Moved

The dramatic spike in oil prices triggered by military strikes on Iran has had minimal direct impact on Bitcoin mining costs. That is the key finding from Hashrate Index analysts who examined the fallout from U.S. and Israeli strikes on Tehran that disrupted shipping through the Strait of Hormuz.

Under normal conditions, roughly 20% of global oil supply transits through the strait. Supply disruptions sent Brent crude from $60 to over $100 per barrel before retreating to $90. Despite the scale of this price shock, the direct correlation between oil prices and mining costs proved negligible.

Why This Matters

Geopolitical upheaval in energy markets has historically raised concerns about Bitcoin mining sustainability. However, the Hashrate Index analysis reveals that the mining industry's energy mix has fundamentally shifted. The primary transmission channel from oil crises to miners now runs through macroeconomic pressure on Bitcoin's price — not through electricity tariffs. Recognizing this distinction is essential for accurately assessing risk across the mining sector.

Which Miners Actually Depend on Oil

According to the Cambridge Centre and the Bitcoin Mining Council, more than half of the Bitcoin network's computing power runs on alternative energy sources. Analysts characterized the share of fuel oil and diesel in the mining energy mix as a "statistical rounding error."

The United States, Russia, and China hold the largest shares of global hashrate, followed by Paraguay, the UAE, Oman, Canada, Ethiopia, and Kazakhstan. Power generation in most of these jurisdictions relies on natural gas, coal, or hydroelectric resources — the link to oil prices is minimal.

Only a small fraction of the network's computing power depends on energy grids where electricity prices genuinely correlate with oil. The UAE and Oman account for approximately 6% of global hashrate. Including Iran, Kuwait, Qatar, and Libya, the share of oil-sensitive regions reaches 8-10%. The analysts noted that even where such correlation exists, the impact is delayed due to lengthy tariff review cycles.

The Real Threat: Hashprice Compression via BTC Price

Researchers identified macroeconomic consequences as the primary danger for miners. Rising oil prices fuel inflation expectations and shift interest rate forecasts, pushing investors to exit risk assets — including Bitcoin. This directly compresses hashprice, the metric measuring revenue per unit of computing power.

This dynamic already materialized earlier in the year. In February, hashprice plunged to a historic low of $27.89 per PH/s per day as Bitcoin dropped 23.8% — from $78,000 to $65,000.

How Miners Are Adapting to Volatility

Some miners have turned to hashrate forward contracts to lock in the selling price of their computing power in advance. Over the past year, this strategy delivered returns 8.2% higher than traditional spot mining.

At the time of the report, hashprice stood at $31.5 per PH/s. The seven-day moving average of total network computing power was estimated at 1.02 ZH/s. In the most recent difficulty adjustment on March 5, mining difficulty was nearly flat, rising just 0.45%.

Wintermute had previously declared the traditional Bitcoin mining model outdated. VanEck's head of digital assets, Matthew Sigel, has also assessed the prospects for mining companies pivoting toward AI infrastructure.