Gulf States suffer the loss of Dh550 billion in energy income due to the regional war

According to Majid Jafar, CEO of Crescent Petroleum Company, the Middle East military dispute is already a total shock to the region’s economy, resulting in a loss of more than $1 billion per day.

Gulf countries have lost $150 billion (Dh550.5 billion) in revenues and business losses due to the Middle East conflict, according to Majid Jafar, CEO of Crescent Petroleum Company.

During a conversation at a meeting with business, finance, and government leaders in Washington, D.C., he stated that the destruction caused to energy infrastructure in the Gulf region exceeded $60 billion.

He further explained that the region was losing billions of dollars each day because of revenue and trade losses.

“Energy equals security,” he added.

The outbreak of war between the US, Israel, and Iran has led to attacks on energy plants in the Gulf region, pushing oil prices past the $100-per-barrel mark.

According to Jafar, the crisis has now evolved into a shock to the entire economy. This is due to its implications extending beyond energy markets, as well as the global economy’s dependence on a few chokepoints through which energy flows.

About one-fifth of the world’s oil is shipped through the Strait of Hormuz, which has been blocked by Iran since the outbreak of the war. According to the United Nations, this blockade has affected one billion people in underdeveloped countries and island nations.

However, this is not only about energy; it is a story about the entire economy, Jafar stated, since the same waterway transports up to one-third of the world’s fertiliser trade, 40 per cent of the world’s helium essential for semiconductors, and a significant amount of feedstock for modern industries.

“Not only will prices at the pump be affected, but also the cost of food on your plate, air travel, and the silicon chips in your smartphone,” he added.

“But infrastructure is not just about steel and cement; it is also about hard work, skills, and the means by which countless people earn their livelihoods every day,” stated Jafar, while honouring engineers, technicians, and workers from the energy sector across the region whose dedication helped deliver vital materials despite extraordinary risks.

Attacking civilian infrastructure that provides energy sources constitutes a war crime under international law, he stated, because of its implications for survival and livelihoods not only in producing nations but also in economies dependent on that energy source, many of which are among the poorest regions in Asia.

Jafar asserted that years of designing energy networks for maximum efficiency had left them vulnerable, adding that resilience would define the future.

“If one only has one exit point from one’s source of supply, no matter how large it is, one can never truly be secure,” he added.

Indeed, resilience itself, he noted, is becoming an investment opportunity, citing possibilities for sovereign wealth funds, development financial institutions, and institutional investors to support the development of energy routes, storage systems, and interconnections.

Across the Gulf, governments are developing new routes that bypass the Strait of Hormuz. They are expanding storage facilities across multiple zones and financing alternative pipelines and connections to reduce dependence on a single vulnerable passage.

Jafar concluded by saying that this is not merely about who produces the most energy, but that the real winners will be those who create strong and flexible systems, utilise resources wisely, and ensure that their people benefit in the long run.