Government Instability in Several Oil, Gas Producing Countries Set to Rise
Government instability is set to rise over the next three years in oil and gas producing countries including Russia, Kazakhstan, Egypt, Kenya and Uganda, which could impact the upstream projects of major energy companies, a new report from global risk analysis company Verisk Maplecroft has revealed.
“We don’t see increasing instability necessarily ending in coups or significant political upheaval, but a less predictable above-ground-risk environment is likely to emerge,” Verisk Maplecroft’s head of financial risk, James Lockhart-Smith, said in an organization statement.
“Arbitrary decision making, possible measures to buy off key stakeholders or an inability to pass regulatory reforms will be the main risks to projects in these countries as their governments seek to stabilize and maintain their influence,” he added.
Turning its attention to oil markets in 2018, the report highlighted the stand-off on the Korean peninsula and the ongoing ‘cold war’ between Saudi Arabia and Iran as the only two geopolitical flashpoints with realistic potential to impact oil prices if they escalate this year.
Outright war in either region is unlikely, however, according to the organization’s Interstate Tensions Forecasting Model, despite an increase in the probability of some form of military incident or show of force between the US and North Korea, which Verisk says has increased from 36 percent to 56 percent since the start of 2017. The likelihood for a direct militarized dispute between Saudi Arabia and Iran is lower at 26 percent.
“A slide into war is not in the interests of any of these countries, but the outlook highlights the aggressive posturing from all sides as intensifying the chances for tensions to escalate,” Verisk said in an organization statement.
“In the worst-case scenario, war between Saudi Arabia and Iran would hit oil supply and cause a spike in prices, while conflict on the Korean Peninsula would have serious negative consequences for the global oil and liquefied natural gas trade,” Verisk added.
WHAT DO YOU THINK?
Generated by readers, the comments included herein do not reflect the views and opinions of Rigzone. All comments are subject to editorial review. Off-topic, inappropriate or insulting comments will be removed.
- Gunvor CEO Sees Russian Refining Capacity Taking Hit from Drone Strikes
- These Factors Helped Brent Oil Price Break Above $85
- Sinopec Engineering Posts Higher Annual Petrochemicals Revenue
- Imperial Pipeline in Winnipeg Goes Offline for Three Months
- Gaz System to Acquire Gas Storage Poland
- Subsea7 Secures Contract to Service Woodside's Trion
- Adnoc Inks Supply Deal for Ruwais LNG Project with Germany's SEFE
- EIA Boosts USA Crude Oil Production Forecasts
- Norway Regulator Blasts Proposal to Halt New Oil and Gas Permits
- Chinese Mega Company Makes Major Oilfield Discovery
- EIA Drops 2024 Henry Hub Gas Price Forecast
- EIA and Standard Chartered Offer Up Latest Oil Price Predictions
- Red Sea Region Sees Another Watershed Incident
- Chevron Oil Project in Kazakhstan to Cost $48.5B
- OPEC Voices Encouragement after IEA Affirms Support for Oil Security
- Biden Govt Bares Strategy for Freight Charging, Hydrogen Fueling Infra
- Rystad Looks at the Buzz Around White Hydrogen
- Ukraine Hits Third Russian Refinery In Escalating Drone Strikes
- VIDEO: Missile Attack Kills Crew Transiting Gulf of Aden
- Norway Regulator Blasts Proposal to Halt New Oil and Gas Permits
- Chinese Mega Company Makes Major Oilfield Discovery
- What Is the Biggest Risk to Offshore Oil and Gas Personnel in 2024?
- Is Peak Oil Demand Close?
- Vessel Sinks in Red Sea After Missile Strike
- JP Morgan, Standard Chartered Reveal Latest Oil Price Forecasts
- Exxon Rights in Stabroek Do Not Apply to Hess Merger with Chevron: Hess
- Rystad Forecasts Net Production of Top Permian Producers in 2024
- Analysts Reveal Latest Oil Price Outlook Following OPEC+ Cut Extension