April 15 (Reuters) - The Middle East conflict could saddle the region with as much as $58 billion in repair costs for energy-linked infrastructure, with oil and gas facilities alone accounting for up
Middle East War May Cost Up to $58 Billion in Repairing Energy Assets: Rystad
Rystad Energy Report Details Infrastructure Damage and Costs
Rising Repair Cost Estimates
April 15 (Reuters) - The Middle East conflict could saddle the region with as much as $58 billion in repair costs for energy-linked infrastructure, with oil and gas facilities alone accounting for up to $50 billion, according to a report by Rystad Energy.
The estimate marks a sharp increase from the research firm's initial $25 billion projection three weeks ago, reflecting a broader scope of damage before an April 8 ceasefire between the U.S. and Iran.
Impact on Global Energy Investment
"Repair work does not create new capacity. It redirects existing capacity, and that redirection will be felt in project delays and into inflation far beyond the Middle East," Rystad senior analyst Karan Satwani said.
"The $58 billion bill is the headline, but the knock-on effects on energy investment timelines globally may prove just as significant."
Breakdown of Repair Spending
Rystad said total repair spending is likely to average around $46 billion, with downstream refining and petrochemical assets accounting for the largest share due to their complexity and extent of damage.
Industrial, power, and desalination assets may add a further $3 billion to $8 billion in costs, the report added.
Differences Across Countries and Assets
Recovery timelines are starting to diverge between assets and countries, showcasing differences in domestic execution capabilities and access to supply chains, Rystad added.
Iran's Widespread Damage
Iran faces the most widespread damage, with repair costs potentially reaching $19 billion, affecting gas processing, refining and export infrastructure.
Qatar's Concentrated but Complex Impact
In contrast, Qatar's impact is more concentrated but technically complex, particularly at its Ras Laffan industrial hub, where repair work may overlap with ongoing LNG expansion projects.
Challenges in Recovery Efforts
Rystad said engineering and construction will account for the largest share of spending, but delays in procuring critical equipment will likely dictate recovery timelines.
According to Rystad, procuring equipment and workers remains the biggest challenge.
(Reporting by Pranav Mathur in Bengalurul; Editing by Leroy Leo)
