While the Middle East energy sector has been looking to diverse into green technology of late, there has also been a resurgence in the price of oil, gold and silver meaning good news for the areas staple products. This could signify the return of long term upward trends or the recent political tensions in the area may have raised the price. The improving economies within the Eurozone suggest that as stability returns to the Gulf’s main export routes, demand is steadily rising.
Indeed, in America, there has been a boom in oil related activities of late mainly through drilling for oil and aerospace projects run by companies like Boeing. In terms of markets, there seems to be a delicate balance between rising stocks and ones which are due to tumble having reached their maximum potential. But in relation to investments, conflict in the Middle East, including Syria, have the potential to drive petrol prices through the roof as uncertainty often leads to a rise in price.
For the investor, however, this is a good thing as it still represents a strong investment opportunity but on an average, even without the volatile prices, oil has been steadily rising for awhile now. This means that those brave enough to invest are likely to see either a steady rise in their assets or a huge bumper price caused by potential upheaval in the Gulf. As the global economies begin to repair them, their need for oil will increase as manufacturing and infrastructure projects are still heavily dependent on fuel.
Another factor which could possible affect the energy markets in the Middle East is the promotion of American and English firms opting for fracking as an alternative to importing oil from Arab countries. It isn’t clear at this stage which this could further destabilise the investment opportunities in the area or whether it will strengthen the need for oil-based products but it should be a factor to consider when investing in the region.
A lot of these influences rely on the theories of supply and demand and so it should be calculated how these factors may affect the amount of oil or the amount of countries increasing their use of it.