Energy News — BP-ADNOC Deal for NewMed Energy on Hold Due to Israel’s Attacks in the Gaza Strip
According to several reports today, the highly anticipated deal for Israel’s NewMed Energy is coming to a halt due to the escalations of attacks in the Gaza Strip. The deal had been initially reached by British Petroleum and UAE’s ADNOC for $2 billion joint purchase of the offshore energy project located in Israel’s exclusive economic zone (EEZ) in the Eastern Mediterranean.
It was reported that NewMed Energy’s statement on the suspension of the deal was due to “uncertainty created in the external environment.” This is referring to the Israel-Hamas War, on the one hand, but also the ongoing risks occurring around the Red Sea with Houthi Rebels indiscriminately attacking vessels and cargo ships in the maritime area.
The Israel-Hamas War is causing widespread concerns for global trade and commodities markets. Gold prices have been going up, while oil prices have been hanging on a thread in anticipation of how the OPEC+ policy to cut oil production will respond to the Middle East regional tension.
UAE’s ADNOC has already been popping up in the news a lot this year. Most notably due to the fact that COP28 President Sultan al-Jaber, who is also chief of the UAE’s oil and gas giant ADNOC, stated his positive outlook on the global energy sector. Several energy leaders and business executives were attending the World Government Summit in Dubai where Sultan al-Jaber addressed the audience with words of praise for COP 28’s results.
ADNOC also reached a crucial deal in the petrochemicals market whereby Austria’s OMV and ADNOC reached final terms for the $20 billion deal to combine forces in a merger of petrochemical assets, including each companies’ stakes in Borealis and Borouge.
War and energy are on the minds of so many people right now. Conflict rages on from the Gaza Strip between Israel and Hamas to the Black Sea between Russia and Ukraine, as well as between armed groups in several countries such as Myanmar and the Democratic Republic of Congo (DRC). Meanwhile, the Saudi-led OPEC+ meetings are stirring up the pot of international politics by cutting output of global oil supplies during Red Sea attacks.
In hindsight the attack on October 7 was successful in getting the world’s attention; in other words, shifting the international perception from the Russia-Ukraine War to the Middle East Conflict. Using foresight will tell a completely different story about the big picture in International Relations.
Read more updates about the global energy markets and energy transition strategies in the publication Areas & Producers.