The Middle East’s divisions extend well beyond politics, religion, culture, and wealth. Countries across the region also differ in their energy mixes, electricity systems, and environmental performance.
The latest annual Energy Institute Statistical Review of World Energy highlights these contrasts. Some of the world’s largest oil exporters remain dependent on natural gas for domestic energy consumption, while others rely upon petroleum products. Likewise, the pace of renewable energy deployment, electricity generation patterns, and greenhouse gas emissions varies across the region.
Some of the world’s largest oil exporters remain dependent on natural gas for domestic energy consumption, while others rely upon petroleum products.
The Middle East consumed nearly 42 exajoules of primary energy last year, accounting for about 7 percent of global energy consumption. With the exception of the United Arab Emirates, whose Barakah Nuclear Power Plant now supplies roughly 8 percent of the country’s primary energy consumption, every country in the region remains overwhelmingly dependent on fossil fuels. Renewable energy, including hydropower, continues to account for a negligible share, if any at all, of national energy consumption across most Middle Eastern countries.
Even among fossil fuels, however, energy portfolios differ considerably. Iraq and Saudi Arabia rely heavily on petroleum products, while natural gas dominates energy consumption in Qatar, Oman, and Iran. Kuwait, the United Arab Emirates, and Israel, by contrast, maintain balanced oil and gas consumption profiles.
Regional energy demand has increased by approximately 20 percent over the past decade. Iraq and Oman recorded the fastest average annual growth, at 3.6 percent, followed by Iran at 3 percent. Israel and Qatar experienced the slowest growth, each averaging around 0.5 percent annually.
Rapid energy demand growth is not surprising given the substantial hydrocarbon revenues that have enabled governments to expand energy access for households and industry. What is more concerning is the region’s poor energy efficiency. Energy intensity—the amount of energy required to produce one unit of economic output—remains well above the global average in nearly every Middle Eastern country except Qatar and Israel. In Iran and Bahrain, energy intensity is nearly twice the world average.
Israel posts the region’s best performance, requiring only about two megajoules of energy to generate $1 of gross domestic product.
This reflects important structural differences. Unlike the hydrocarbon-dependent economies of the Gulf Cooperation Council states, Israel has a diversified economy driven by advanced manufacturing, technology, and services. More than half of its exports consist of services, which reached $92 billion last year—roughly equivalent to Iran’s total merchandise exports, including both oil and non-oil products. The disparities become even more apparent in the electricity sector.
Electricity generation in the Middle East has expanded at an average annual rate of 3.5 percent over the past decade, significantly outpacing the global average of 2.8 percent. Total regional electricity generation exceeded 1,600 terawatt-hours last year.
Yet renewable electricity, including hydropower, accounted for only 92 terawatt-hours, representing less than 6 percent of total generation.
Excluding hydropower, however, renewable deployment varies substantially among countries. Saudi Arabia and the United Arab Emirates lead the region, each generating more than 19 terawatt-hours of electricity from solar and wind power, followed by Israel with more than 14 terawatt-hours.
One of the region’s most alarming trends has been the sharp decline in hydropower generation. Iran, Iraq, and Israel remain the Middle East’s principal hydropower producers, yet their output fell dramatically last year—by 37 percent, 29 percent, and 12 percent, respectively. These declines may serve as an early warning of intensifying water scarcity and prolonged drought across the region.
Among the region’s major oil and gas consumers, Israel was the only country to reduce emissions last year, recording a 3.8 percent decline.
The Middle East emitted more than 3 billion tons of greenhouse gases last year, with Iran alone accounting for roughly half of the regional total.
Despite its commitments under the Paris Climate Agreement, Iran has increased its greenhouse gas emissions by 31 percent over the past decade. As a result, it overtook Japan this year to become the world’s fifth-largest emitter, behind China, the United States, India, and Russia.
Among the region’s major oil and gas consumers, Israel was the only country to reduce emissions last year, recording a 3.8 percent decline. By contrast, the United Arab Emirates posted the largest annual increase in greenhouse gas emissions at 3.9 percent, followed by Iraq at 2.6 percent.
The region’s limited deployment of renewable energy, combined with rising greenhouse gas emissions, underscores how far the Middle East still has to go in reducing its overwhelming dependence on fossil fuels. While several countries have announced ambitious energy-transition strategies, the latest data suggest that meaningful decarbonization remains at an early stage.
