The Middle East's oil and gas sector is poised for significant long-term investment despite ongoing regional conflicts, with nearly $100 billion in greenfield projects in the pipeline and repair costs for conflict-damaged facilities approaching $50 billion, according to industry executives at the Upstream Global Development and Decarbonisation Week.

Investment Scale and Drivers

Aditya Saraswat, Middle East and North Africa research director at Rystad Energy, highlighted that the region has close to $100 billion worth of oil and gas greenfield projects in development. The cost of repairs to facilities affected by the conflict is already nearing $50 billion, and announced bypass options for the Strait of Hormuz are expected to cost between $15 billion and $20 billion, with costs likely to more than double in the coming years. Saraswat noted that investment levels in the Middle East are almost double those of the pre-Covid-19 cycle, and this trend is expected to continue for the rest of the decade. While some investment decisions have been delayed due to the conflict, incremental upstream investments are anticipated over a slightly longer timeframe.

Regional Resilience and Strategic Importance

Ian Prescott, CEO of Lamprell, stated that energy companies in the Middle East maintain ambitious production and growth targets, with no abatement in their investment plans to develop facilities, improve production, and become cleaner. Khamis Al Mazrouei, CEO of Sharjah National Oil Company (SNOC), emphasized that the regional disruption is not new and that the company has set its spending across cycles of volatility, with projects moving forward while focusing on resilience and energy security. Amena Bakr, head of Middle East Energy and Opec+ insights at Kpler, noted that the Middle East region is defiant and will continue to grow, spend, and expand, particularly in its upstream sector. She highlighted that the crisis has underscored the importance of energy security and the upstream sector, with confidence remaining strong in the region's oil and gas sector. Key drivers include Adnoc’s $150 billion investment plan for 2026-2030 and Saudi Aramco’s maintained capital expenditure.

Long-Term Outlook and Market Share

Ross Cassidy, vice president of Middle East and North Africa research at Welligence Energy Analytics, acknowledged short-term disruptions to capex and investment pace but affirmed that the region's oil and gas resources and low cost of production will ensure its global importance in the long term. Bakr added that the conflict has demonstrated a lack of spare capacity elsewhere in the world to fill gaps, reinforcing the Middle East's enduring role as a reliable supplier. Panellists predicted that the region's market share is unlikely to be affected by the recent conflict in the longer term, citing its strategic location, long-term investment history, and reliable supply to the world.