Insurers Shift Focus to Oil Projects Outside the Middle East
Global insurers are increasingly underwriting oil and gas projects outside the Middle East as geopolitical tensions continue to disrupt operations in the region. The conflict has led to war-risk premiums, project delays, and cost inflation, prompting insurance firms to compete for a shrinking pool of upstream energy developments not located in active war zones. Premiums for upstream energy insurance have dropped by up to 50% year-to-date as insurers slash rates to attract business outside the Middle East. This shift is driven by oil companies expanding their exploration efforts into regions like Guyana, Suriname, Namibia, Brazil, and Nigeria. Insurers are keen on maintaining exposure in a historically profitable sector despite market softening. Major energy firms such as ExxonMobil and Chevron are investing heavily in offshore projects to offset production losses from the Middle East crisis. These developments signal a broader industry trend of diversifying supply chains away from volatile regions.
Topics: geopolitical risk insurance underwriting Middle East conflict oil and gas