The Arab Gulf is stepping into a pivotal role in global energy markets—not just as a swing oil supplier, but as a gas powerhouse. With production gains, long-term partnerships, and major investments in LNG infrastructure and carbon mitigation, the region is positioning itself as a cornerstone of energy security in an energy world in transition.
What happened
The Middle East is approaching a critical energy inflexion point. According to the latest projections from Rystad Energy, the Middle East is poised to overtake Asia as the world’s second-largest gas-producing region in 2025, trailing only North America. Output across the region is expected to reach approximately 69.6 billion cubic feet (bcf), compared to 68.2 bcf in Asia.
It is not only a matter of scale. It denotes a more deliberate orientation amongst Arab Gulf producers to maximise their hydrocarbon resource endowments—one that positions them not only as important swing oil suppliers but as increasingly indispensable actors in global gas security.
Why it matters
The transformation is being led by Saudi Arabia, Qatar, and the UAE, each of which is pursuing a distinct pathway to monetise gas reserves, expand LNG capacity, and secure long-term export contracts. Their ambitions are not solely commercial. They are geopolitical—calculated responses to a world in flux, where energy security has re-emerged as a defining feature of international relations.
Maximising their hydrocarbon resource endowments positions Arab Gulf producers as increasingly indispensable actors in global gas security
Qatar, long the world's leading LNG exporter, is consolidating its dominance. The North Field expansion will increase capacity from 77 million tonnes per annum (mtpa) to 126 mtpa by 2027. Doha has already secured long-term supply agreements with China, Germany, and France—deals that not only guarantee revenue but also embed Qatar into the energy security strategies of major powers.
These are not transactional arrangements; they are strategic partnerships that confer influence and resilience. In parallel, Qatar is expanding its global LNG footprint through investments abroad—most notably in the United States, where it holds a 70% stake in the Golden Pass LNG terminal in Texas, co-owned with ExxonMobil. The facility is expected to begin production by the end of 2025, further embedding Qatar's role in transatlantic energy security.
The UAE, for its part, is emerging as a nimble and increasingly assertive gas player. Abu Dhabi National Oil Company's (ADNOC) investment in the Ruwais LNG terminal—expected to double its capacity to reach 9.6 mtpa in 2028—is part of a broader effort to position the UAE as a reliable supplier. Abu Dhabi is also extending its LNG reach globally, with strategic supply agreements and infrastructure investments across North America, Europe, and Asia. Notably, it has signed long-term deals with Germany and Japan, while deepening energy ties with China through prospective joint ventures in downstream and LNG logistics. These moves not only reflect the UAE's commercial foresight but also its deliberate effort to ensure that the country remains a trusted partner in the evolving energy order.
Saudi Arabia—traditionally viewed through the lens of oil—is now making a serious play in gas. The Jafurah field—one of the largest unconventional gas projects outside the United States—is central to the Kingdom's ambition to become a net gas exporter by the end of the decade. Its pivot is not incidental. It is part of a strategy to reduce domestic reliance on oil but retain the Kingdom's leading role in global energy markets.
Riyadh is also extending its gas ambitions internationally. Aramco has signed a 20-year agreement to purchase LNG from the Rio Grande export terminal in Texas and is exploring a potential equity stake in Woodside Energy's $18bn Louisiana LNG project. These moves, alongside a memorandum of understanding with Sempra to secure additional volumes, signal Saudi Arabia's intent to build a global LNG portfolio and establish a foothold in key export markets.
Visitors at the Aramco pavilion at the Misk Global Forum for Innovation and Technology in Riyadh, Saudi Arabia, November 13, 2019.
What unites these efforts is a shared recognition that gas has become a strategic asset. In the wake of Russia's invasion of Ukraine, Europe has scrambled to replace Russian pipeline gas with LNG from more diversified sources. At the same time, Asia's demand for gas continues to rise, driven by industrial growth and the need to displace coal. Arab Gulf producers are stepping into this space, offering not only supply but also stability—a combination that is sometimes scarce in today's complex energy landscape.
The Arab Gulf states' competitive advantage rests on three core strengths. First, cost. Arab Gulf gas is among the cheapest to produce globally, giving it a natural edge in a price-sensitive market. Second, infrastructure. Massive investments in liquefaction, storage, and shipping capacity are enabling the region to scale up exports rapidly. Third, credibility. The Arab Gulf's track record of honouring contracts and delivering on time has made it a preferred partner for buyers seeking reliability in an increasingly fragmented energy system.
Climate challenge
However, the gas moment is not without risk. Price volatility remains a persistent challenge, particularly as global LNG markets become more liquid and exposed to spot pricing. Geopolitical tensions—whether in the Strait of Hormuz, the Red Sea, or further afield—could disrupt supply chains and deter investment. Furthermore, the pace of the global energy transition remains uncertain. While gas is cleaner than coal, it is still a fossil fuel, and its long-term role in a net-zero world is far from assured.
The Jafurah field—one of the largest unconventional gas projects outside the US—is central to Saudi Arabia's ambition to become a net gas exporter
Arab Gulf producers have already taken tangible steps to address the carbon intensity of their gas. QatarEnergy is integrating carbon capture and storage (CCS) into its flagship North Field East expansion, in partnership with TotalEnergies, and is developing a CCS facility at Ras Laffan designed to capture 4.3 million tonnes of CO₂ annually. ADNOC has scaled up its Al Reyadah CCS project, one of the first commercial-scale CCS facilities in the region and is expanding its capacity as part of its broader decarbonisation strategy. Meanwhile, Aramco is advancing its Jubail CCS project with embedded low-emission technologies and has committed to capturing up to 9 million tonnes of CO₂ per year by 2027, and contributing toward the Kingdom's national goal of capturing and utilising up to 44 million tonnes of CO₂ annually by 2035. All three companies have also signed up to the Oil and Gas Methane Partnership (OGMP) 2.0, aligning their methane reduction targets with international standards.
These efforts reflect a recognition that competitiveness in global gas markets increasingly depends on climate performance. Indeed, scrutiny is intensifying. To maintain their edge and ensure continued access to climate-conscious markets, Arab Gulf producers will need to scale up these initiatives and lead with transparency in emissions reporting and environmental governance.
Defining role
The Arab Gulf has long been a sub-region critical to the global energy system, but its role is evolving. Today, it is not only sustaining its influence through oil but expanding it through gas, shaping the future of global supply, pricing, and energy diplomacy. As the global energy order continues to evolve, the Arab Gulf's emergence as a major gas producer warrants close attention.
