The Middle East war has damaged as much as $58 billion worth of energy infrastructure, according to an estimate published by consulting firm Rystad Energy on Wednesday.
Iran has attacked the oil and gas infrastructure of its Gulf Arab neighbors including production facilities, refineries and pipelines among other targets. Israel has bombed natural gas and petrochemical facilities in Iran.
More than 80 energy facilities have been attacked in all since the U.S. and Israel launched the war on Iran on Feb. 28, said Fatih Birol, executive director of the International Energy Agency. More than a third of those are severely damaged, Birol said.
“This is one of the most critical issues and different than the past — many of the facilities are badly damaged,” the IEA chief said Monday at an Atlantic Council event in Washington, D.C. It could take as long as two years to repair facilities and restore oil-and-gas production to pre-war levels, he said.
At a minimum, the repair bill for any damage is at least $34 billion, Rystad estimated. The extent of the damage is still not clear at some facilities, the firm said. The final bill will depend on whether the damage to those assets is more limited or structural.
At the same time, the amount of equipment needed for the repair work will stress global energy supply chains, said Karan Satwani, a senior analyst for supply chain research at Rystad.
Iran’s infrastructure has absorbed the biggest hit, with repair costs potentially coming in at $19 billion, Rystad estimates. Qatar also faces steep costs after Iran struck its key liquified natural gas (LNG) facility.
Attacks on energy facilities escalated after Israel bombed Iran’s South Pars natural gas complex on March 18. Iran retaliated by attacking the world’s largest LNG facility in Qatar, damaging two production lines responsible for 17% of the small Gulf state’s gas exports.
The damage to Qatar’s LNG facilitiy will result in $20 billion of lost revenue and will take as long as five years to repair, state-owned QatarEnergy said in a March 19 statement.
Iran has also attacked pipelines, refineries and production facilities in Saudi Arabia, Kuwait and the United Arab Emirates.
