GCC oil and gas sector still dominates economy, ready to invest in new tech

The slump in oil prices and move towards diversification has not reduced the significance of the oil and gas industry in the Gulf Cooperation Council, a senior expert has said.
“The regional oil and gas industry has been the cornerstone of the regional economies for decades now and will continue to be so,” GE Oil and Gas, Middle East, North Africa and Turkey president and chief executive officer Rami Qasem told Gulf Business.

Crude oil prices have more than halved since hitting highs of around $114 in June 2014. Exporters in the GCC have started to feel the pinch despite boasting vast reserves.

Oil export losses in 2015 are expected to reach about $300bn, or 21 per cent of gross domestic product in the GCC, the International Monetary Fund warned earlier this year.

Following a recent trip to Qatar, the IMF’s managing director Christine Lagarde also cautioned that fiscal and current account balances in the region were “deteriorating sharply.”

However, Qasem asserted that the oil and gas industry remained a dominant contributor to the gross domestic product of regional countries.

“The national oil companies are taking the lead in driving localisation agendas to help drive local skills, talent and to build the local supply chain,” he said.

And GE is also working with these companies to introduce its industrial internet solutions regionally, he added.

“The current market volatility makes it a very sensible time to invest in industrial internet – because of the efficiency and productivity it brings to the table. Even an increase of 1 per cent in efficiency brings significant benefits at a time when the industry is focusing on reducing costs and optimising assets,” he said.

The company recently unveiled several of its industrial internet and software solutions for the region. It claimed they could help the Middle East, North Africa and Turkey region to deliver economic gains of $465bn by 2025.