Middle East to dominate oil export market

By Carola Hoyos in London
Published: February 13 2006 17:24 | Last updated: February 13 2006 17:24

Europe and the US are expected to become increasingly dependent on the Middle East as an exporter of refined petroleum products over the next 10 years.

New FT research shows that refining capacity in the Middle East is to overtake that of Russia and the former Soviet republics, where underinvestment has plagued the energy sector.

Aggressive policies to build big refineries that will boost capacity in the Persian Gulf by 60 per cent will dramatically increase the region’s exports to US and Europe, just as Washington looks to break its dependence on oil from the Persian Gulf.

Ali Naimi, Saudi Arabia’s energy minister, when asked what needed to be done to reduce the high price of oil and its volatility, answered: “Build refineries, build refineries, build them right now!”

But Saudi Arabia is not only building new refineries to reduce price volatility. Helping the world overcome its current shortage in refinery capacity will ensure the Kingdom play’s an increasingly important geopolitical role in the future. The potential financial reward is also high.

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