Jeddah – Saudi Arabia has long been a hot spot for international exporters.
The country has also become a hub for Saudi Arabia’s own Gulf partners, including the United Arab Emirates, Qatar and Bahrain.
But for those countries, as well as other countries, which have been battling a drought in their own regions, the country is a haven for food, water and energy supplies.
This is the latest reason why Saudi Arabia and its neighbours are scrambling to secure the region’s energy supplies in order to help alleviate the country’s food shortages.
With the region struggling with a chronic food shortage, Saudi Arabia was keen to diversify its energy supply, which in the past was predominantly petroleum, with gas.
The UAE is the country most reliant on Saudi Arabia for energy, but the UAE has a limited capacity to tap Saudi gas for its own consumption.
So Saudi Arabia looked to the UAE as an alternative.
This week, Saudi King Salman announced that it will supply the UAE with gas to help ease its water and food shortages, as part of its ‘Coalition for Clean Energy’ to help meet its climate change targets.
The Saudi announcement comes in the wake of a Saudi energy minister revealing that Saudi Arabia would be purchasing gas from Egypt in order for the country to get more of its energy needs met.
Egypt is a key oil producer in the Middle East, and as a result of a recent deal between Saudi Arabia, Qatar, Bahrain and the United States, the Gulf countries are committed to buying Egypt’s gas.
Saudi Arabia also recently signed a deal to purchase Egyptian gas.
However, despite this, there is still a long way to go for Saudi to fully fulfill its commitments.
“The United Arab Emirate is currently importing oil from Egypt for consumption,” a senior UAE official told Gulf News.
“However, Egypt is currently exporting some of its oil to other countries to satisfy their energy needs.
So, it is not easy to get the necessary volumes of oil to be delivered to the Gulf.
We have been doing this since 2015 and it is a long process, but we are trying to do it,” the official added.
Saudi energy officials told Gulf Times that the Saudi gas purchases are part of a long-term plan to diversifying the countrys energy supply.
“We are trying our best to diversified our energy supply by diversifying our gas imports,” the Saudi Energy Minister for Energy and Natural Resources Khalid al-Falih told Gulf Daily.
“This is not a short-term solution.
It is a longer-term and permanent solution.
We are trying hard to diversifies our energy supplies to meet the needs of the market and the Gulf,” he added.
This was also reported by Gulf News, which quoted the Saudi minister as saying that the UAE would buy gas from the country.
“For the UAE, this is a solution to its energy shortages.
It will not be easy to buy gas for the UAE from Saudi Arabia.
The problem is that Saudi is a country which imports about 70% of its gas from outside the region.
And for us, this gas imports is part of our gas needs,” he said.
However the UAE does not have the ability to import enough gas to meet its energy requirements, and this has made it a priority to purchase gas from countries that can do so.
The Kuwaiti Gulf News newspaper, which is close to the Saudi and UAE energy ministries, reported that the Gulf states have been in talks to purchase the gas from Qatar.
Kuwait is also believed to be considering buying more gas from Russia, which has been a key customer for Saudi oil.
The Qatar Petroleum Authority, which runs the Qatar Gas Pipeline (QGPP), announced that the country would buy a total of 6 million cubic meters of gas from Saudi in March.
Saudi also plans to purchase some of the gas it sells to Qatar from Algeria, which supplies a third of the world’s oil imports.
But Algeria has been struggling with high prices and a chronic shortage of gas, and it will likely be the last gas it buys from Qatar for several years to come.
The Gulf states are also currently planning to buy some of Qatar’s gas from a new gas field in the south of the country, which could be used to supply Saudi Arabia with more energy than it has currently.
The report also said that the United Nations and the European Union have been pushing for the Gulf to diversize its energy supplies, but there are still a lot of hurdles to jump before the GCC will be able to diversise.
“It’s not just about diversification,” Khalid al Falih told the Gulf Daily, referring to the regions energy needs and the energy policy that needs to be pursued in order not to become a gas importer to the rest of the Middle Eastern world.
“There are also a lot more challenges and we still need to look at the whole strategy to diversification.
There are many challenges and there are many more projects in the pipeline,” he noted.