For quite a long time, the Middle East has been the global energy supply center. But lately it started to lose its attractiveness among global oil production companies.
Constant military conflicts, riots, and outbreaks of violence as well as gradual reduction in gas and oil production make businesses folding their tents.
Since the beginning of the 1948 Arab-Israeli War, geopolitical situation is only getting worse. The number of soldiers who are actively involved in military conflicts is increasing, the territory of hostilities is expanding, and the weapons are being upgraded.
A growing number of victims make matters worse. Thus, the latest conflict in Gaza claimed over 2,000 victims in Pakistan and 60 Israeli soldiers. Incessant civil war, sectarian conflicts and serious socio-economic problems in Iraq and Syria are direct evidence of a frightening level of violence in the region. So all these factors make for a fading attractiveness of the Persian Gulf which still has the world’s largest concentration of natural gas and oil.
Profitability of running business in this region is questioned by the owners of the major oil companies because of increasing costs due to the war. Moreover, the risk of supply disruptions has become more significant. Cost of doing business is rising with companies constantly having to boost their security expenses.
The center of oil and gas industry is gradually shifting towards Africa, Asia, North America, and South America. Kazakhstan and Azerbaijan have solid oil reserves. In South Africa, West Africa and Latin America large oil deposits have been discovered recently.
