In The Spotlight
Musaab Al Mulla (right) in conversation with Daniel Evans, VP, global head, fuels & refining, S&P Global Energy. (Image source: S&P Global Energy)
The role of refining in resilient energy systems
At the S&P Global Energy Middle East Petroleum & Gas Conference (MPGC) held in London, Musaab Al Mulla, Aramco's vice president of market analysis and sustainability, underlined the need for the recognition of the role refined products play in resilient energy systems, which has been brought into sharp focus in the current crisis
Al Mulla highlighted the need for a realistic approach to the role of oil and gas as the engine for economic growth and the impact of the crisis on products ranging from helium to materials and fertilisers, with shortages of the latter in turn impacting food supply.
A common theme of the event was the need for resilience and redundancy in the energy system to be able to weather such crises. Al Mulla highlighted Aramco’s focus on long-term strategic planning and investment for the future, as exemplified by its investment in the east-west pipeline which is now not only transporting crude but also products, building flexibility into the system, transporting crude to refineries for export and ensuring refined products get to market.
“The world has realised the need for more investment in pipeline infrastructure and domestic refining to ensure industry is working together,” he said.
He remarked that the crisis has demonstrated demand is resilient and has exposed the underinvestment in refineries, with capital flows being redirected towards the energy transition and resulting in a deficit of 3mn bpd.
“We need to build refineries and infrastructure while also reducing emissions,” he said, noting that Aramco has one of the lowest emissions intensities.
Discussing demand for refined products, he noted that demand for jet fuel continues to grow and refinery utilisation is at record rates.
“We believe demand will continue to be resilient, and low carbon products will be important as well,” he said.
He foresaw strong growth in chemicals with the market for durable materials growing in multiple sectors, noting that carbon-based materials can help reduce emissions. Replacing steel with polypropylene in cars can reduce emissions by 80%, for example. He also highlighted growth in demand for low carbon aviation fuel (lcaf), fossil-based jet fuel, which is 10% lower in emissions than conventional jet fuel, and complements sustainable aviation fuel (saf) as it addresses some of its limitations.
Highlighting the continuing long-term strategic importance of refining, he stressed that gasolene will still account for a significant proportion of transportation fuel by 2050.
With resilience, reliability and sustainability being global challenges, Al Mulla said that resilience for Aramco means building on operational excellence, long-term investment in oil and gas, new energies and low carbon, and localisation, noting Aramco’s 70% localisation target to ensure a resilient supply chain.
“Resilience is correlated with sustainability, you can’t be sustainable if you are not resilient,” he said. It involves not only having the flexibility to be able to adapt to shocks, but also having the capacity to innovate and grow supply while also reducing emissions, he added.
Commenting on the Middle East’s attractiveness as an investment destination, he said, “Clearly the region remains the hub for oil and gas petrochemicals and refining, and it has shown its infrastructure and energy system have been resilient in this historic crisis.”
He said Aramco is also looking at other regions, and urged the need for more investor-friendly policies in Europe, where there is a need for more domestic refining and chemicals so as not to be dependent on other regions.
Discussing the role of gas, Al Mulla said there will be increasing demand to fulfil the growing demand for power from data centres, highlighting the move towards regional data centres.
In the current market, the physical impact of OPEC's decision will be very limited. (Image source: Adobe Stock)
OPEC+ decision to raise production likely to have limited impact
The seven OPEC+ countries, which previously announced additional voluntary adjustments in April and November 2023, namely Saudi Arabia, Russia, Iraq, Kuwait, Kazakhstan, Algeria, and Oman, have agreed to increase production by 188,000 bpd from July
However, the impact of this increased production quota is likely to be limited, according to Jorge Leon, head of geopolitical analysis at Rystad Energy
“With the Strait of Hormuz closed, the issue is not whether OPEC+ raises paper quotas, but whether additional barrels can actually reach the market,” he said.
“OPEC+’s decision to continue increasing production by 188,000 barrels per day confirms that the group remains on track to unwind the first tranche of voluntary cuts by September, if not earlier. But in the current market, the physical impact of such a decision would be close to zero.”
Leon noted that not only is the Gulf facing oil export obstacles, Russia is also under pressure as a result of intensifying drone attacks on its oil infrastructure.
“The latest increase will likely expose a widening gap between OPEC+ targets and Russia’s actual production capacity,” he said.
“The more important question is what happens after the first tranche of voluntary cuts has been fully unwound. The capacity assessment currently undergoing should serve as the basis for 2027 quotas, but with the Strait of Hormuz closed and several producers operating far below normal levels, it will be very difficult to accurately assess each country’s sustainable production capacity. That makes the next quota reset much more politically sensitive.”
Once the Strait of Hormuz reopens and flows gradually recover, the market could face a very large surplus, he pointed out, driven by returning OPEC+ supply, stronger US shale output and weaker demand after a period of very high oil prices. The UAE, now free from its OPEC quotas, would also likely ramp up production.
Once restocking concludes, OPEC+ may be forced to implement cuts again.
“That is when cohesion will become the central issue. OPEC+ cohesion is easy to maintain when the market does the discipline for you. The real test is whether that holds when the barrels come back, stocks rebuild and members have to decide who cuts.”
At the moment though, the reopening of the Strait of Hormuz seems a distant prospect, given the resumption of hostilities between Israel and Iran, which has caused the oil price to spike again.
“Despite ongoing diplomatic efforts, markets remain concerned that even a peace agreement would not immediately restore normal energy flows due to damaged infrastructure, mined waterways, and production outages,” commented MUFG Bank, echoing other industry analysts. “The renewed escalation has reinforced fears of prolonged supply disruptions, keeping upward pressure on oil prices despite OPEC+ plans to gradually increase output.”
The webinar will address the risks and realities of dissimilar flange connections. (Image source: Adobe Stock)
Webinar: The risks and realities of dissimilar flange connections
Oil Review Middle East is hosting an exclusive webinar by GPT Industries on Dissimilar Flange Connections: Corrosion Risks, Misconceptions, and Practical Solutions, on Thursday 18 June at 9.30am GST
Dissimilar flange connections are widely used across industries, yet they remain a misunderstood and underestimated source of corrosion risk, operational failure, and unexpected cost. This webinar will explore why these connections exist, how they behave in real-world environments, and the critical factors that influence their performance. It will provide practical insight into the risks and realities of dissimilar flange connections, with a focus on corrosion mechanisms, common misconceptions, and effective mitigation strategies to improve reliability and reduce long-term costs.
The session will cover:
✔️ Understanding galvanic corrosion in dissimilar flanges
✔️ The dangers of localised corrosion and its impact on asset reliability
✔️ Common misconceptions around cladding and sealing methods
✔️ Available mitigation strategies, including coatings, bolting practices, and flange isolation kits
✔️ How to apply practical decision-making frameworks based on risk, environment, and lifecycle cost considerations
Register here
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Expert presenters will be Rebecca ZImbra – product engineer, GPT Industries, metallurgical/materials engineer with industry, management, and research and development experience and expertise in materials testing, cathodic protection, failure analysis, and weld inspection; and Nick Bander, director – Engineering and Product Management at GPT Industries, an experienced technical team manager with a focus on manufacturing, pipeline corrosion mitigation, oil and gas, energy, and water/wastewater industries, and expertise in team/people development, product application, product design, pipeline, sealing, corrosion, and cathodic protection.
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McDermott Secures Strategic Project Management Consultancy Contract with Aramco.
McDermott secures major Aramco PMC contract
McDermott has announced a highly coveted partnership: it has been hand-selected by Aramco as one of only eleven contractors to drive forward massive project management consultancy solutions across the Kingdom of Saudi Arabia.
Executing complex energy infrastructure is a strategic priority for Aramco, tied directly to the Kingdom’s long-term development goals. Securing robust project management provides a reliable, integrated framework for large-scale energy, downstream, petrochemical, and low-carbon programmes.
Through a newly established multi-year Project Management Consultancy (PMC) Long-Term Agreement (LTA), McDermott is officially positioned as a central engineering and project management service provider within Aramco's sprawling strategic investment portfolio. Operating as a fully integrated provider in over 30 countries with a workforce exceeding 30,000 personnel, McDermott continues to advance the next generation of global energy infrastructure.
The joint venture's integrated Out-of-Kingdom and In-Kingdom delivery model leverages McDermott's global experience alongside Solutions Leaders Fayez Engineering's (SLFE) local capabilities. SLFE operates as an Aramco-approved general engineering services plus (GES+) contractor, and this framework produces dynamic, efficient execution while adhering to Aramco's rigorous In-Kingdom Total Value Add (IKTVA) and localisation objectives.
As part of this strategic collaboration, McDermott will combine its overarching technical expertise and global delivery frameworks with SLFE's robust domestic presence to seamlessly transform project execution. McDermott will provide its technology leadership in overall execution planning, governance, and front-end development (pre-FEED and FEED), seamless integration through established engineering centres, and continuous oversight to develop a fit-for-purpose project management solution for Aramco processes. SLFE, meanwhile, will spearhead engineering and client support within the Kingdom.
“Just as the United States and the Kingdom share a commitment to long-term collaboration, we share a commitment with SLFE to localisation, knowledge transfer and sustainable capacity building within the Kingdom,” said Michael McKelvy, McDermott's chief executive officer and chair of the board.
“This long‑term agreement reflects Aramco's confidence in our proven execution capabilities and our track record of delivering complex, world‑class projects in the Kingdom,” added Rob Shaul, McDermott's senior vice president of low carbon solutions.
Ashraf Alkhaznadar, SLFE's president and CEO, noted the mutual benefits of the joint venture for the region's broader development. “We are proud to partner with McDermott on this strategic agreement with Aramco,” he said. “Together, we bring complementary strengths that support Aramco's long‑term vision while continuing to develop national engineering capability.”
This landmark agreement underscores McDermott’s deeply rooted relationship with Aramco and its established history of successfully executing intricate engineering and energy projects throughout the Middle East. By continuing to deliver fully integrated, technology-driven solutions from concept to commissioning, McDermott is not only cementing its critical role in advancing the Kingdom's long-term developmental and energy transition targets, but it is also actively shaping the next generation of global energy infrastructure to empower a more sustainable future for the wider industry.
An artist’s illustration showing a floating production system with mooring spread. Image from Sonardyne.
Sonardyne and AMOG partner for advanced subsea asset monitoring
As offshore energy infrastructure expands into increasingly demanding environments, safeguarding the integrity of underwater assets has become a paramount priority for the sector
Rising to this challenge, the underwater technology specialist Sonardyne has formally signed a Memorandum of Understanding (MoU) with AMOG, an international advanced engineering company. Together, they are set to provide a complete subsea asset monitoring service tailored directly to the needs of offshore energy infrastructure operators.
This strategic alliance seamlessly integrates Sonardyne’s trusted underwater positioning, communication, and monitoring technologies with the industry-leading engineering assessment expertise of AMOG. By harnessing their combined capabilities, the partnership aims to unlock vital insights into asset health, substantially reduce costly operational downtime, and enable the safe life extension of critical underwater architecture. Crucially, this comprehensive monitoring approach will support a wide spectrum of subsea installations, encompassing floating offshore wind platforms and traditional oil and gas moorings, alongside essential pipelines and risers.
Dr Hayden Marcollo, a globally recognised specialist in moorings and vortex-induced vibration engineering and analysis, serves as a director at AMOG. Highlighting the transformative potential of the collaboration, he says: “Combining high‑quality subsea data, processed at source on Observer, with advanced engineering assessments, will provide asset owners with more actionable, near-real-time insight into the condition and behaviour of critical subsea infrastructure through a single solution.”
The implications for infrastructure management are profound. Providing a unified approach to complex engineering challenges allows for a proactive rather than reactive operational strategy. As Dr Marcollo further elaborates regarding the commercial benefits: “For operators, this could support earlier detection of anomalies, improved understanding of loads and motions, and more informed decisions around inspection, maintenance and integrity management, as well as asset longevity, in one end-to-end solution.”
The practical application of this partnership is already well underway. Demonstrating the system's immediate relevance to the rapidly expanding renewable energy market, Sonardyne and AMOG are actively collaborating on a near-real-time mooring monitoring system tailored for a European floating offshore wind project.
Frank Rose, business development manager at Sonardyne, outlined the broader vision for the joint initiative. He notes: “By integrating on-demand and long‑term monitoring data from subsea environments with engineering models and analytics, there’s an opportunity to provide a more complete picture of asset performance—whether supporting day‑to‑day operations, integrity assurance or life‑extension strategies.”
This MoU represents a forward-thinking approach to subsea infrastructure management that promises to enhance operational excellence. “By working alongside AMOG, we’re exploring how data and engineering assessments can come together to give operators greater confidence in the way their subsea assets are performing, today and over the long term," Rose adds
Aramco will combine its expertise and intellectual property with Emerson’s advanced corrosion solutions to digitalise and transform corrosion management. (Image source: Emerson)
Emerson and Aramco to collaborate on corrosion management solutions
Emerson has announced it will co-develop next-generation corrosion management solutions for Aramco
Corrosion management is a strategic priority for Aramco, tied directly to operational performance, safety and environmental responsibility. Continuous corrosion monitoring eliminates difficult, inefficient and dangerous manual corrosion measurements and provides a reliable digital data stream for improved decision making.
At the Middle East Metallurgy, Corrosion & Coatings (MECOC) Expo earlier this year, Aramco’s executive vice president of technical services, Wail A Al Jaafari said that Aramco has invested more than US$70mn in corrosion management technologies, achieving over US$770mn in cost savings and avoidance.
“AI-powered solutions are now anticipating corrosion before it happens, leveraging a cast network of IIOT sensors across our facilities and pipelines. These sensors provide more than 10mn corrosion-motoring readings annually across over 40 facilities,” he said.
Aramco’s Hybrid Statistical Corrosion Prediction Model, HySCorr, leverages 20 years’ worth of data, using machine learning and advanced flow and corrosion modelling to produce dynamic, predictive and more accurate monitoring of pipeline health, therefore protecting thousands of kilometres of pipelines.
As part of the corrosion research and development collaboration with Emerson, Aramco will combine its expertise and intellectual property with Emerson’s advanced corrosion solutions to digitalise and transform corrosion management. Emerson will provide its technology leadership in ultrasonic online corrosion monitoring technology; seamless wireless connectivity for corrosion wall thickness monitors, and real-time and continuous data collection to develop a fit-for-purpose corrosion management solution for Aramco processes.
“Emerson, with our complete technology stack, is uniquely positioned to co-innovate the next-generation corrosion monitoring solutions that are cost-effective, scalable and customised for Aramco,” said Ram Krishnan, chief operating officer for Emerson. “We look forward to working with Aramco to develop not only a corrosion solution for its vast operations, but one that will also be a valuable tool for many other industries.”
LNG investment is expected to more than double in 2026 compared with 2025. (Image source: Adobe Stock)
Oil investment declines while gas investment rises: IEA report
Oil investment is set to decline for a third consecutive year, while natural gas investment is projected to rise to the highest level in a decade, according to the 2026 edition of the IEA’s annual World Energy Investment report
Despite higher oil prices, oil investment is expected to fall below US$500bn, as uncertainty over the duration of the price spike, long project lead times, supply chain constraints and tighter offshore rig markets limit spending outside the Middle East.
Global upstream investment is expected to rise marginally in 2026, with declines in the Middle East and North America offset by increases mainly in Central and South America and Africa, but new refinery investment is expected to fall to decade-level lows.
At the same time, natural gas investment is projected to rise to US$330bn, supported by a wave of new LNG export projects, particularly in the USA and Qatar. LNG investment is expected to more than double in 2026 compared with 2025 as more than 230 bcm of projects advance toward peak construction.
The report highlights that the impact of the conflict in the Middle East and the effective closure of the Strait of Hormuz is prompting countries and companies to reshape energy investment strategies with a focus on security and diversification, particularly in Asia and the Middle East.
The report projects that total global energy investment will reach US$3.4 trillion in 2026, a slight increase year-on-year. Around US$2.2 trillion is expected to go to grids, storage, low-emissions fuels, nuclear, renewables, efficiency and electrification in 2026, while around US$1.2 trillion is set to be invested in oil, natural gas and coal.
Electricity and diversification drive spending
Electricity and diversification are driving growth in energy spending with countries seeking to respond to the second energy crisis in five years with new routes and domestically available resources. There is a growing focus among fuel-importing countries on domestic energy sources including renewables, nuclear power and, in some cases, coal. Investment in renewable power projects is expected to total around US$665bn in 2026, with US$365bn going toward solar alone. Nuclear investment is continuing its resurgence, exceeding US$80bn annually, with close to 80 gigawatts of new nuclear capacity under construction across 15 countries.
Coal investment, meanwhile, is also set to rise to US$180bn in 2026, the highest level since 2012, with China accounting for almost 70% of global coal supply spending. The report notes that some Asian countries may seek to keep existing coal-fired power plants operating for longer to bolster energy security.
Electricity-related investment remains a dominant theme. Investment in electricity supply and infrastructure is expected to reach nearly US$1.6 trillion in 2026 with spending on electricity grids projected to approach US$550bn, up nearly 20% year-on-year, while battery storage investment is set to exceed US$100bn.
The electricity demands of the rapid expansion of data centres and artificial intelligence are also becoming a major influence on energy investment trends in some markets, particularly in the USA. Orders for new gas-fired power plants reached a 25-year high in 2025, with data centre needs playing a significant role.
The report highlights an increased focus on energy efficiency as a result of the crisis, although there are plenty of gaps that need to be filled.
The report notes that the Middle East conflict is impacting the availability of finance for future energy projects, triggering volatility within financial markets, slowing investment decisions in the short term and pushing up long-term financing costs. This could disproportionately affect capital-intensive energy technologies, the report warns, particularly in emerging and developing economies where financing costs are already significantly higher than in advanced economies.
“We are in the midst of the largest energy security crisis the world has ever faced – and I believe this will reshape investment strategies globally, with parallels to the major changes the energy world witnessed after the oil shocks of the 1970s,” said IEA executive director Fatih Birol. “We are already seeing intensified efforts by both producer and consumer countries to diversify trade routes and energy sources – such as advancing new pipelines and other supply infrastructure, on the one hand, and turning more to domestically available resources, on the other. These range from renewables and nuclear to coal, oil and gas, in some cases – as well as broader measures to strengthen electricity systems, expand electrification and accelerate energy efficiency.”