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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.
Dr Carole Nakhle and Lord Howell co-authored Out of the Energy Labyrinth published in 2007

 

Related Analysis

Oil Market Outlook: Expectations and Realities”, Dr Carole Nakhle, Oct 2020

Oil market outlook: sailing in the dark”, Dr Carole Nakhle, Sep 2020

Clean Energy and Fossil Fuels in the Middle East: A virtuous cycle?”, Dr Carole Nakhle, Jul 2020

Related Comments

The Geopolitics of Oil and Gas and US-Gulf Arab Relations”, Dr Carole Nakhle, Oct 2020

The Oil & Gas Sector of Lebanon: What we need to know with Dr Carole Nakhle”, Dr Carole Nakhle, Oct 2020

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