Lack of American petroleum imports will not affect Middle Eastern market

With political situations intensifying over the past few months, the petroleum sector in the Middle East has been showing signs of strain.

As the United States’ need for Middle Eastern and North African oil decreases, concerns have risen about the influence this will have on the flow of petroleum products around the globe. The President of the United States, Barack Obama, has promised to ensure that oil markets will not be hit by the American decline in imports.

“We will ensure the free flow of energy from the region to the world. Although America is steadily reducing our own dependence on imported oil, the world still depends upon the region’s energy supply, and a severe disruption could destabilize the entire global economy,” the President said in a recent conference with the United Nations.

As the domestic mining of oil and gas rises in the United States, the demand for Middle Eastern products has been put in jeopardy. America hit its peak on petroleum import reliance in 2005 and has been steadily working towards self-sufficiency in this sector.

Despite this, United States officials have repeatedly stated their commitment to keeping petroleum product flow at a high. A statement from a senior State Department representative in March of this year declared that the lower reliance on oil imports for America “in no way change[s] the U.S. commitment to global security, to peace and stability in the Middle East, and to security in transit lanes.”

Demand from other countries has not faltered, however. Egyptian government representatives have been in talks with Saudi Arabian, Kuwaiti and Emirati officials to organise petroleum product reserves to be given to Egypt, beginning in October 2013 and continuing into the new year.

Approximately $1.2 billion of oil products are imported by Egypt monthly, so the demand is extremely high – and with the political situation continually varying in stability, the need for a constant supply of petroleum is necessary. The local consumption of petroleum products and natural gas has reached 73.2 EQ.

Other agreements for providing Egypt with petroleum products have fallen through, with Iraq and Libya unable to come to a satisfactory arrangement with Egypt over repayment and guarantees of provision.