Oil markets and Middle East Geopolitics: Old battles continuing or new hopes emerging?

Dr Carole Nakhle, CEO of Crystol Energy, and Lord Howell, Chairman of the Advisory Board of Crystol Energy, were the guest speakers at the “Oil markets and Middle East Geopolitics: old battles continuing or new hopes emerging?” webinar, hosted by the Arab Bankers Association.

Key highlights of the discussion:

Western policy-makers have to grasp that Middle East problems are not just a Western affair. China is everywhere. A Chinese consortium is building the massive new port of Duqm in Oman, China in encamped in Djibouti. Chinese investment in the MENA region is now reaching $2 trillion.
Western powers need to balance their relationship with China, and with the whole of Asia. The adjustment of Western Governments to that new factor – and the speed of that adjustment – is probably going to be the most important route of all to reduced conflict, more peace and therefore more stability and more prosperity in a very fast changing Middle East environment.
Turkey has (re) emerged as a major new disruptive factor (again) in the region. Are the Ottomans back??
The way the energy transformation plays out over the next ten years, as between continued world demand for fossil fuels and the rise of low-emissions renewables, along with the progress of hydrogen and nuclear power developments, is going to have a major impact on Middle East region stability – not least through Budget breakeven challenges and the social consequences of fundamental economic change.
Oil markets have fundamentally changed in the last ten years, first with the shale revolution and now with COVID-19 and the energy transition. But it is not all doom and gloom for the Middle East, as their main competitive advantage is low cost, massive proven oil and gas reserves. They are therefore well placed to be the last to leave the market but first they have to break the stubborn link between their economic growth and oil prices.