Insurers Cut Energy Premiums as Middle East Conflict Drives Shift

Global insurers have begun slashing upstream energy premiums for projects outside of the Middle East in response to the ongoing conflict in the region.

The war in the Middle East, which began at the end of February, has made oil and gas production in the area increasingly volatile, leading to a significant increase in insurance costs for projects in the region.

However, with many oil and gas companies shifting their focus to safer basins outside of the Middle East, insurers are now competing for a share of the market in these areas.

As a result, premiums for upstream energy insurance have fallen by around 25% year-to-date, with some insurers slashing prices by as much as 50%, even at a short-term loss, according to industry insiders.