Oil From Desert

Oil production in the Middle East faces a variety of water risks, as the region is one of the world’s most arid. It should come as no surprise that nearly 93 percent of the Middle East’s onshore oil reserves are exposed to medium to extremely high overall water quantity risk (see sidebar).

In addition to these supply concerns, energy companies in the Middle East face two primary water risks. First, inadequate desalination or other water infrastructure can disrupt ongoing projects, delaying oil drilling, production, and processing extraction and production. Second, domestic desalination consumes oil resources that would have been exported to customers around the world. In Saudi Arabia, for example, oil is sold to power and desalination plants at around $4 a barrel, but can be exported at around $100 a barrel.