Naji Abi-Aad, PhD, Energy Economist and Strategist
The instability in the Middle East continues to affect petroleum security supplies, which in turn is considered a threat to international peace and global markets, especially if associated with petroleum supply disruptions. This behavior derives from an implicit conviction that Middle Eastern petroleum is to be ‘shared’ among its producers and consumers.
Petroleum has always weighed in heavily in the Middle East with its geopolitical and strategic aspects. The region holds more than 48 percent of the world’s oil reserves and around 40 percent of its gas reserves. Therefore, the petroleum industry in the Middle East is indeed highly exposed to both internal instabilities as well as to external attacks and violence, which can have major consequences on the petroleum supply. This is especially true for petroleum pipelines in the region, although the situation differs between oil pipelines and those channeling natural gas.
This analysis looks at the historical trends of the major oil and gas pipelines of the Middle East, and dives into their operational patterns and the reasons behind their continuous shutdowns. It also highlights the interlinkages between the latter and the political stability of the region. Additionally, the analysis focuses on the new realities of the global gas markets and the need to build a regional gas network between countries of the Middle East for its long-term economic and energy security benefits.