Mideast War Turns Spotlight on Arab Gas Pipeline

The armed conflict in the Middle East has yet to significantly impact oil and gas flows in the region, but critical infrastructure, such as the Arab Gas Pipeline (AGP), is being closely monitored. This pipeline connects Egypt with Jordan and has previously experienced disruptions in the Sinai Peninsula due to attacks. It's a critical point of concern because Jordan is heavily reliant on energy imports and if gas supply from AGP were to halt, it could pose serious socio-economic challenges and potentially lead to instability within the country. More broadly, if the conflict in Gaza escalates, it could negatively influence sentiment among international investors during a pivotal time when both Israel and Lebanon are seeking to encourage offshore oil and gas exploration activities. Eurasia Group warns that high casualty levels in Gaza and potential escalation of conflict into a regional war could lead to a severe degradation of the investment climate in the Levant and the Gulf. Furthermore, if a war were to break out along Israel's northern border with Lebanon, involving Iran, it could result in massive hits to business and consumer confidence. Beyond direct conflict, how these tensions affect the operations and development plans of key energy infrastructure and initiatives such as AGP and offshore exploration respectively, will have far-reaching effects on the regional energy landscape.