If you don’t receive Parks Paton Hoepfl & Brown’s (PPHB) “Musings from the Oil Patch,” you probably are not aware of the speculation that trouble could be brewing again in the Middle East. I realize it isn’t exactly considered news when there is instability in the Middle East. It’s more aptly viewed as par for the course. But PPHB has taken an interesting slant on recent developments that is worthy of consideration. According to PPHB, “A number of recent data points have emerged that suggest the Middle East may become a focal point of political and possibly military action before the end of the year, or maybe even earlier.” A few months ago, PPHB says, the world was focused on the possibility that Iran was building nuclear weapons. It is rumored that Israel, which carried out an air strike on Iran in the past, could be planning another strike. Additional rumors go so far as to say that Saudi Arabia has granted the Israeli Air Force permission to land helicopters in its country. All of this talk has thus far led to nothing, but there are interesting developments in the works. “Two of the most significant developments are a $60 billion US sale of defense equipment to Saudi Arabia that includes upgraded F-15 fighter planes, attack helicopters, and missiles and bombs, including bunker-buster bombs. The last item would seem to suggest that the Saudi air force may be preparing for a possible fight with Iran and the need to attack its military and possibly nuclear facilities. The other development is the announcement that the United Arab Emirates (UAE) has opened a new port on the Arabian Sea. The port also has oil storage tanks. The port lies beyond the Strait of Hormuz and the oil storage facilities will be hooked up to a pipeline stretching from Abu Dhabi that is currently under construction.” Last week, PPHB observes, Nouri al-Maliki, prime minister of Iraq, went to Iran looking for guidance on creating a coalition government in Iraq. The advice he got from Ayatollah Ali Khamenei, Iran’s supreme leader was simple. “Get rid of America.” While Iraq/Iran talks were going on in Teheran, an “interesting twist in the US-Iran relationship” was in the works. For the first time ever, a high-ranking Iranian diplomat attended the recent NATO meeting on the transition in Afghanistan. This diplomat also attended a briefing by US General David Patraeus on NATO’s military strategy in Afghanistan. These two events are interesting when taken together, according to PPHB, because they raise questions about whether Iran is securing expansionist goals without having to work very hard and without raising the ire of other nations around the world. It is significant that Iran has given al-Maliki the choice of siding with Iran to form a stable government in Iraq or siding with the US and continuing the ongoing crisis. A critical consideration here is the enormous oil reserves in Iraq that the country has planned to develop with western partners. Less domestic turmoil could speed up development, which PPHB says would do two important things: 1) Provide badly needed oil and refined products to Iran. 2) Bring huge new global oil production onstream in a few years time putting oil prices under pressure. Neither of these options, PPHB says, will be good for Saudi Arabia, which is the biggest US ally in the region. This turn of events would strengthen Iran to withstand sanctions and boost its military strength, PPHB speculates. So is Iran conspiring to change the balance of power in the Middle East? Time will tell. In the meantime, if you want to read PPHB’s comments in their entirety, you can sign up to receive “Musings from the Oil Patch.”
Guyana Kicks Off Oil Conference as Exxon Mulls Adding More Blocks
2023-02-14 - Exxon Mobil is working to increase Guyana production to 1.2 MMbbl/d by 2027 and possibly beyond, according to president of oil and gas production business Liam Mallon.
Russia's Lukoil Looks to Sell Stake in Ghana's Pecan Field
2023-02-27 - Lukoil is talking directly to potential buyers for its offshore Pecan oilfield stake because investment bankers are not getting involved due to western sanctions on Russia.
Namibia Makes Third Oil Discovery in the Orange Basin
2023-03-06 - Namibia's third oil discovery could make the country another oil producer along the African Atlantic coast.
Shell, Chevron and Petrobras Weigh Guyana Oil Auction Bids
2023-03-06 - Guyana's vice president Bharrat Jagdeo is set to meet with top energy executives at this week's CERAWeek in Houston to gain support for the South American country's bidding round.
Frontera, CGX Start Drilling Wei-1 Well in Guyana
2023-01-23 - The joint venture between CGX Energy Inc. and Frontera Energy Corp. begins drilling in Guyana as the region becomes an oil exploration hot spot.