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From oil to hydrogen: The Middle East’s next global advantage

The Middle East is emerging as a global leader in hydrogen, leveraging abundant renewable resources and strategic location. This page explores how green and blue hydrogen can drive the region’s clean energy future and economic diversification.

The Middle East is emerging as a key player in the global hydrogen economy, driven by its abundant renewable resources, strategic location, and strong government commitment. As the world accelerates its transition to cleaner energy, green and blue hydrogen offer promising pathways to decarbonise heavy industry, transport, and power generation. This thought leadership explores how the Gulf Cooperation Council (GCC) countries can capitalise on these opportunities to diversify their economies and lead the energy transition.

Despite challenges such as production costs and infrastructure needs, the region’s unique advantages—including high solar irradiance, existing export facilities, and proximity to major markets—position it well to scale hydrogen production and export. With growing global demand and supportive policies, the Middle East is set to become a global hub for hydrogen, unlocking new avenues for sustainable growth and industrial innovation.

Green hydrogen is produced by splitting water into hydrogen and oxygen using renewable electricity, resulting in zero carbon emissions. Blue hydrogen is generated from natural gas with carbon capture and storage to reduce emissions, serving as a transitional solution. 

The Middle East benefits from high solar irradiance, abundant land, existing export infrastructure, and proximity to major markets. Governments in the region have set ambitious targets and policies to support hydrogen development, making it a prime location for scaling production and export.

Key challenges include the high cost of renewable hydrogen production, infrastructure requirements for storage and transport, and the need for commercial incentives to drive demand. These are being addressed through financial innovations, policy support, and international partnerships.

We offer strategic advisory services to governments, investors, and industry players, helping them develop hydrogen strategies, manage risks, secure financing, and implement projects that capitalise on the Middle East’s hydrogen potential.

Hydrogen is no longer a question of if, but where. The Middle East’s unique combination of climate, infrastructure, and political will makes it a natural leader in the global energy transition.

Joerg Doerler | Partner | Strategy & Transactions

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