Middle East and climate change: policies threaten oil economies
A report submitted to the NATO Parliamentary Assembly on Saturday will outline how climate change could make the Middle East even more conflict-prone than it already is.
With only 1% of the world’s renewable water sources and 5% of its population, the Middle East is particularly vulnerable to droughts. These are expected to be more frequent and severe as climate change takes hold, increasing competition for scarce resources. This, in turn, increases the risk of regional and civil conflicts.
Ironically, the tools being developed to fight climate change—particularly cheap and reliable renewable energy—could do more damage to the region than climate change itself, at least in the medium-term. A reduction in demand for oil and gas will depress prices which, at $50 a barrel, have already halved in the past two years.
The governments of Saudi Arabia, Iraq and Libya each derive more than 90% of their public funds from hydrocarbons and require prices above $80 a barrel to keep their budgets in the black. The consequences of a sustained low in global oil markets would devastate these economies and exacerbate already existing social tensions.
While work is under way to ween the Saudi economy off oil, this task is gargantuan and will take decades to pull off—time the Kingdom’s rulers may not have.
