top of page
synergy logo.png

Energy Security in the Post Abqaiq World - Barış Sanlı

Last week, one of the most important crude oil facilities in the world has been attacked. The initial reaction of markets to the event was a 20% hike, later settling to much lower figures. The coincidence of such a big event with a world economy in dim outlook has saved the day for now. But the echoes of this event will change the energy security question forever, again.

It is hard to predict the full extend of energy crises in the near term. Flow of the information dominates the public mindset and with each bit of information the event is decyrpted. The initial stage is this “understanding” stage of what has happened?. This understanding can only turn into policies and strategies with a certain delay. For the Abqaiq event, we are in the “understanding” stage. Our minds are occupied by the price hikes, pictures and statements. But as the details became crystal clear, it will change institutional, organizational and strategic views about energy security in years to come.

On the 24th Feb 2006, Al-Qaeda has attacked the same facility with two vehicles with explosives. There were terrorists involved in the attack. It was the first direct attack by Al-Qaeda on a Saudi oil installation . But it wasn’t successful. 13 years later the same facility has been attacked by 18 drones and 7 cruise missiles, basically with no human on the field . This time the attack has made the damage to the facilities and the world markets.

The main question is the power of innovation on the threat side. Innovation has been generally associated with all the good and bright things like renewable energy, electric cars, digitalization, consumers. As states accelerate the innovative processess, technology may pave the way for a better world. But what if state actors choose to innovate on the darker side? Can they dismantle the welfare and progress we made so far? And what should be the new energy security perspective in the age of innovative technologies and weapons.

The energy security has been related and sometimes synonymous with diversity in the past. It reminds a basic portfolio theory. Don’t put all the eggs in the same basket. These eggs were generally geographically seperated actors or suppliers or routes. But when innovation diminish the effect of geographic boundaries, can we surely assume that diversifying is a safe bet?

Unfortunately diversifying may not be enough although it is still relevant. In an integrated world of energy markets, no one can escape from the costs of substantial risks. These risks may translate into domestic risks or economics malaises.

The history shows that when whale oil prices were increased, the quest for the next resource was accelerated. Practically, so called energy transition has gained momentum. As the transition to the crude oil economy evolved then diversification of the resource, routes and geographies made sense. But from whale oil to crude oil, diversification was not the main problem. The main security solution was transition to another kind of technology and energy economy.

Some may think that this transition is another diversification. This is a fair argument. But transitioning to a different energy economy and buying from another supplier are far apart arguments. They may look similar, but a progress and portfolio formation are hardly same.

Are the recent attacks such important? Probably yes and the importance will increase as time passes by. Because this is a new energy world with Asia in dominance, USA in retreat, world is fragmented. State sponsored innovative threats can easily be replicated with lower costs. Geographic diversification can only be a short term physical remedy. Every new technology hailed as game changer is a “threat changer”. As the threat factors move like startups, preventive and security mechanisms are as fast as the big organizational structures -like states- resisting change.

Energy security concepts of the 20th century is tested by the innovative new threats in the 21st century. Diversification is still relevant. However it is a weaker solution then before. Innovation and energy transition can be the only viable options for the foreseeable future. As we settle with the energy economy of digital, clean tech and etc, then a new energy security concept will be the zeitgeist of that age.


bottom of page