In The Spotlight
LNG trains, refineries, fuel terminals and critical gas-to-liquids facilities across the region have incurred damage. (Image source: Adobe Stock).
Gulf energy infrastructure repair bill could top US$25bn
Repair and restoration costs of Middle East war-damaged infrastructure are likely to top US$25bn, and could rise further, according to Rystad Energy assessments
Particularly hard hit has been Qatar’s Ras Laffan Industrial City, where the destruction of LNG trains has triggered force majeure and a 17% capacity reduction, equivalent to about 12.8 million tonnes per annum (Mtpa). A full recovery could take up to five years, given that the gas turbines required to power LNG main refrigeration compressors are supplied by only three original equipment manufacturers (OEM) globally, all of which have production backlogs.
Bahrain has also been badly impacted, says Rystad. BapcoEnergies’ Sitra Refinery was struck twice, damaging two crude distillation units (CDU) and a tank farm, with force majeure declared across group operations. The facility had just been completed under its US$7bn modernisation program in December 2025. Restoring the units could require international contractors to be re-mobilised at considerable cost, as the damaged assets had only recently come online.
There were also disruptions in other countries, including the UAE, Kuwait, Iraq and Saudi Arabia. It is noteworthy that Saudi Aramco was able to swiftly restart operations at Ras Tanura, where maintenance teams were already onsite for a planned turnaround when debris fell inside the perimeter, reflecting its domestic capability.
The speed of recovery in the region will depend on execution capacity and capital deployment timing, as repair spending ramps up. Operators are likely to prioritise restoring existing fields, creating demand for EPC contractors and OEMs, especially those with regional experience and existing agreements with national oil companies. Near-term work will most likely focus on inspection, engineering and site preparation, followed by equipment replacement and construction as procurement constraints ease. In Iran, domestic and East Asian companies will likely carry out most of the repair work given continued Western sanctions, which could be slower and more expensive.
“The Gulf region’s recovery will be defined less by financial capital and more by structural constraints,” said Audun Martinsen, head of Supply Chain Research at Rystad Energy.
“While some assets may be restored within months, others could remain offline for years. Beyond the status of the Strait of Hormuz, every day of damaged or shut-in infrastructure pushes pre-war production capacity further out of reach. Iran’s South Pars offshore field and Qatar’s Ras Laffan facility stand out as particularly concerning cases. The scale of damage and long lead times for critical equipment could result in slow recovery. Urgent repairs will have to take precedence in place of planned expansion.”
Kuwait is going ahead with its offshore development programme. (Image source: Adobe Stock)
Kuwait to go ahead with key strategic projects
At CERAWeek, taking place in Houston from 23-27 March, Shaikh Nawaf S. Al-Sabah, deputy chairman and CEO of Kuwait Petroleum Corporation (KPC) reaffirmed progress on key strategic projects, including Project Seif and Project Peregrine, despite the current situation
Project Seif involves the development of Kuwait’s recently-discovered offshore fields, in which Kuwait is inviting IOCs to participate, and will ensure “additional production resilience and capacity to help meet production targets in the future,” Shaikh Al-Sabah said in his virtual address. Kuwait aims to lift production capacity to 4mn bpd by 2035 from around 2.5mn bpd currently.
“This is something that is of paramount importance in Kuwait, it is a project with real international scope and we’re moving ahead with this,” he confirmed.
“At the same time, on a shorter timescale, we have Project Peregrine, which is the project by which we lease and lease back our pipelines,” he continued. “This will be the largest single foreign investment in Kuwait.”
He added that the principal partners and investors had confirmed that they are still keen for the project to go ahead, and to continue to participate.
“This is a recognition that Kuwait remains open for business through these attacks,” he said, in reference to Iran’s drone attacks on the country's critical infrastructure facilities.
Shaikh Al-Sabah highlighted the global implications of any disruptions in the Strait of Hormuz, noting its “vital concern” to the world economy, with around 75% of Asia’s oil and 83% of its LNG passing through it.
“It’s a domino effect,” he said. ”The costs of this war don’t stay in geographical lines in this region, they extend all the way through the supply chain.” He noted the impact on petrochemical supply chains and even food security, given the use of polyethylene in food packaging. He added that most of the world’s urea fertiliser comes from the Gulf.
Echoing other Gulf energy leaders, he said, “We are outraged by this attack on us. These attacks are no just on the Gulf, but are holding the world’s economy hostage. This is an attack on our sovereignty in Kuwait, on our people, and on our facilities. This act is unjustified and illegal by all standards."
SLB strengthens collaboration with NVIDIA to accelerate AI for energy
SLB is expanding its technology collaboration with NVIDIA to design and deploy critical AI infrastructure and models for the energy industry
It follows the announcement of plans in 2024 to develop generative artificial intelligence solutions for the energy sector using NVIDIA software integrated with SLB’s Delfi digital platform and Lumi data and AI platform.
The initiative covers traditional machine learning, generative AI and emerging agentic AI technologies designed to improve performance and support reliable, efficient and lower-carbon energy systems.
Three strategic elements
It focuses on three strategic elements:
• Modular design for data centres: SLB will serve as the modular design partner for NVIDIA DSX AI factories, driving increased quality and reliability while also reducing costs, labour constraints and lead times, as well as enabling rapid and flexible scaling
• AI Factory for Energy: SLB will work with NVIDIA to develop an “AI Factory for Energy,” a reference environment powered by domain-specific generative AI models and industrial-scale agentic AI. This will run on SLB’s digital platforms to help energy companies scale AI for their data and operations.
• Accelerated computing for SLB digital platforms: The companies will optimise the processing of large datasets and AI models across SLB digital platforms using the latest NVIDIA AI infrastructure, boosting performance and efficiency in energy applications.
“The winners in AI will be companies with the best data, the deepest domain expertise and the ability to scale,” said Demos Pafitis, SLB’s chief technology officer. “By collaborating with NVIDIA to advance modular data centre construction and harness our domain expertise and digital platforms, we’re enabling the energy industry to deploy AI at scale and transform operational data into smarter decisions.”
"AI is becoming the engine of a new industrial revolution, and the energy industry is at its forefront," said Vladimir Troy, vice president of AI Infrastructure at NVIDIA. "Building AI Factory infrastructure and domain models is needed to turn massive amounts of energy data into actionable insights and accelerate more efficient and sustainable energy systems."
HE Dr. Sultan Al Jaber. (Image source: ADNOC)
ADNOC CEO decries "economic terrorism"
His Excellency Dr Sultan Ahmed Al Jaber, UAE Minister of Industry and Advanced Technology, ADNOC managing director and Group CEO, chairman of Masdar and executive chairman of XRG, has said that weaponising the Strait of Hormuz is an act of economic terrorism with global impact far beyond energy markets
Speaking at CERAWeek, taking place in Houston, Texas, Dr. Al Jaber said, “Twenty-one miles wide. Twenty million barrels a day. Nearly a fifth of the world’s oil and gas. Over a third of the world’s fertilizer. Almost a quarter of the world’s petrochemicals and significant amounts of industrial metals. In short, much of the oxygen of the global economy runs through a single throat. Yet, Iran believes that choking it is an acceptable strategy.
“When Hormuz is squeezed, the pressure is immediately felt around the world. In just three weeks, the price of oil has risen by 50%. This is raising the cost of living for those who can least afford it and slowing economic growth everywhere. From factories, to farms, to families around the world, the human cost is mounting by the day.
“Weaponising the Strait of Hormuz is not an act of aggression against one nation. It is economic terrorism against every nation. And no country should be allowed to hold Hormuz hostage, not now, not ever. And while we appreciate all efforts to stabilise markets and reduce prices, this is not a supply issue. It is a security issue, and it has only one durable answer, keeping the Strait open. We cannot trade our way out of this crisis.”
Dr. Al Jaber stressed the UAE did not ask for conflict and had taken every possible step to prevent it, but its defences, resilience and character had withstood attack when it came.
“At ADNOC, we took hits no civilian enterprise, let alone one focused on delivering energy to the world, should ever have to take. We are deploying extraordinary measures to keep our people safe and to make sure, as much as possible, every customer and every stakeholder gets what they need.”
Dr. Al Jaber said the UAE and ADNOC’s resilience was not a reaction, but the result of years of investment in infrastructure, preparation and long term planning and strategic partnerships.
“We built ADNOC into one of the most reliable energy companies on Earth not because disruption never reaches our borders, but because when it does, we stay the course. That’s why we have diversified how we produce energy. We have expanded the routes that connect supply to markets.
“We have integrated all sources of energy at scale. We have embedded technology and AI across our operations as the force multiplier that will define the next era of energy. And we have built a global network of partners who believe that energy security is a shared responsibility.”
He ended with an invitation to energy leaders to attend ADIPEC in November, where the resilience of the global energy system will be a focus of discussion.
Meanwhile, ADNOC Gas has confirmed in a disclosure to the Abu Dhabi Securities Exchange that operations are continuing safely across its asset base. Following debris falling near certain facilities, inspections confirmed no injuries and no impact to core processing integrity, the company said. Operations were suspended at the Shah gas plant, which provides around 20% of the UAE’s gas supply, following a drone attack, and were also suspended at Habshan gas facility, one of the region’s largest, on 18 March after the interception of missiles targeting the facility and the Bab oilfield, which caused falling debris.
“The company’s continued focus is on ensuring the safety of staff, contractors, partners, and operations while continuing to serve its customers,” the company states.
In response to ongoing shipping disruption in the Strait of Hormuz, ADNOC Gas has separately made temporary operational adjustments to production of LNG and Export Traded Liquids and is actively collaborating with customers and partners on a transaction-by-transaction basis to fulfill commitments wherever possible.
Starlink services will now be available in Kuwait. (Image source: Alghanim Industries)
Alghanim's Starlink to support remote offshore installations
Unlocking access to SpaceX’s satellite internet network and the largest constellation of low Earth orbit satellites, Alghanim Industries (Kutayba Alghanim Group) has launched Starlink services in Kuwait through its technology venture Sama X, good news for remote offshore oil and gas facilities and maritime fleets
In Kuwait, Sama X has introduced several subscription plans with over 300 Mbps download speeds, which promise fast delivery, professional installation, and local support, including a 24/7 bilingual call centre. The service operates in accordance with Kuwait’s telecommunications regulations and the approvals issued by the relevant authorities. For inquiries, customers can call 22055736.
"The launch of Starlink services in Kuwait through Sama X marks an important step in strengthening the country’s digital infrastructure," said Kutayba Y Alghanim, executive chairman of Alghanim Industries. "At a time when reliable connectivity has become essential for business continuity and the effective functioning of key sectors, this technology provides advanced connectivity that helps organisations, governments, and communities stay connected wherever they operate — from remote worksites to critical sectors such as healthcare and education. Through this initiative, we continue to support the adoption of advanced technologies that strengthen Kuwait’s digital readiness and open new opportunities for innovation and growth."
Starlink's consistent support with reliable communication is capable of driving businesses across Kuwait, including remote offshore oil and gas installations and maritime fleets at sea. Its high-speed connectivity enhances safety and improve operational efficiency, supporting seamless streaming, cloud-based applications, and data-driven services across multiple industries.
"Making Starlink services available in Kuwait marks an important step in expanding advanced connectivity options for businesses and individuals across the country," said Amit Somani, CEO of Sama X. "At Sama X, we are focused on making this technology easy to access through fast installation and dedicated local support. Our partnership with Xcite further expands availability, allowing customers to purchase Starlink services easily through Xcite’s online channels and nationwide stores."
Fatih Birol, IEA executive director. (Image source: IEA)
IEA Member countries to release emergency reserves
The 32 Member countries of the International Energy Agency have agreed to make 400 million barrels of oil from their emergency reserves available to the market, the largest release of emergency oil stocks in the Agency’s history, to address the loss of supply stemming from the war in the Middle East and the effective closure of the Strait of Hormuz
In a statement, IEA executive director Fatih Birol noted that the conflict in the Middle East is having a significant impact on global oil and gas markets, with major implications for security, affordability and the global economy.
The conflict in the Middle East that began on 28 February 2026 has impeded oil flows through the Strait of Hormuz, with export volumes of crude and refined products currently at less than 10% of pre-conflict levels. Without sufficient routes to market and without sufficient storage, regional operators have been forced to shut in or curtail a substantial amount of production. They are also experiencing attacks on their energy and energy-related infrastructure.
An average of 20 million barrels per day of crude oil and oil products transited the Strait of Hormuz in 2025, or around 25% of the world’s seaborne oil trade. Options for oil flows to bypass the Strait of Hormuz are limited.
Refinery operations are also being disrupted, with implications for the jet fuel and diesel supplies.
“The situation of the natural gas markets is challenging, with few options to replace LNG cargoes from Qatar and the UAE. These have been reduced by 20%, leaving balances even tighter than for oil,” Birol remarked. Asia has been the most profoundly affected, and is forced to compete with other markets for LNG cargos.
“The oil market challenges we are facing are unprecedented in scale, therefore I am very glad that IEA Member countries have responded with an emergency collective action of unprecedented size,” said Birol. “Oil markets are global, so the response to major disruptions needs to be global too. Energy security is the founding mandate of the IEA, and I am pleased that IEA Members are showing strong solidarity in taking decisive action together.”
While this will alleviate the immediate disruption, the most important thing is to stabilise flows and allow traffic to resume through the Strait of Hormuz, he said.
The emergency stocks will be made available to the market over a timeframe that is appropriate to the national circumstances of each Member country and will be supplemented by additional emergency measures by some countries.
IEA members hold emergency stockpiles of over 1.2 billion barrels, with a further 600 million barrels of industry stocks held under government obligation. The coordinated stock release is the sixth in the history of the IEA, which was created in 1974. Previous collective actions were taken in 1991, 2005, 2011, and twice in 2022.
The IEA Secretariat will provide further details of how this collective action will be implemented in due course. It will also continue to closely monitor global oil and gas markets and to provide recommendations to Member governments, as needed.
“The IEA will continue its mission of upholding energy security, as we have done today for the oil markets, and will continue to do across the entire energy sector,” Birol concluded.
Brent and WTI prices pushed past US$115 a barrel on 9 March 2026. (Image source: GlobalData)
Oil markets remain acutely sensitive to Gulf developments: GlobalData
As Brent and WTI prices pushed past US$115 a barrel on 9 March 2026, the world was in for a major supply shock
“The latest price spike indicates that the market is rapidly transitioning from pricing in a logistics disruption to factoring in a potential supply shock. Initially, traders reacted to maritime risks in the Strait of Hormuz, which raised shipping costs and delayed cargoes. However, recent developments suggest that actual production and export volumes across key Gulf producers are now at risk, fundamentally tightening global supply expectations," said Jaison Davis, economic research analyst at GlobalData, an intelligence and productivity platform.
He went on to explain how the sharp price rise exposed the market’s spare capacity buffer. "Even relatively small disruptions to Gulf production can trigger outsized price movements because the region accounts for a disproportionate share of globally traded crude," Davis said.
“The current surge in prices also reflects the concentration risk within the global oil system. A large share of exports from Saudi Arabia, Iraq, Kuwait, and the UAE passes through the Strait of Hormuz, leaving global energy supply exposed to geopolitical disruptions in a single maritime corridor. Financial markets have already begun pricing in the broader macroeconomic consequences of the oil shock, including rising inflation expectations, currency volatility, and pressure on equity markets across energy-importing economies," he said.
Duration remains the most influential determining factor at this point. While prices may find balance if stability is restored in the Strait of Hormuz, it can easily lead to a structural supply deficit situation if there's no end in sight for the conflict.
“At the same time, should GCC states, along with Turkey, manage to influence the US and international diplomatic channels toward de-escalation, markets may begin to unwind some of the current geopolitical risk premiums. Tanker flows through the Strait of Hormuz could stabilise, insurance and freight costs could moderate, and production cuts could be reversed, gradually pushing oil prices closer to pre-crisis levels. Residual volatility would likely persist, but a credible ceasefire or mediation effort could alleviate worst-case supply fears and ease pressure on energy-importing economies.
"Nonetheless, oil markets will remain acutely sensitive to developments in the Gulf region. Pricing dynamics are increasingly shaped by security conditions and the resilience of export routes through the Strait of Hormuz. Even with short-term stabilisation in shipping, any lingering disruption to production, infrastructure, or tanker traffic risks sustaining elevated volatility, as well as renewed inflationary pressures for oil-importing countries,” said Davis.
Offshore Technology Conference (OTC 2023)
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Website:
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