The oil sheikhs are hedging. Not against price crashes this time. They are betting on a different molecule. Hydrogen. Green hydrogen.
Westminster types think they can lecture the Gulf on net zero. They are missing the point. The Gulf states aren't converts. They are realists. They see the writing on the wall. The energy transition is coming. They want to own the next chapter.
Saudi Arabia's Neom project is not just a vanity city. It is a laboratory for green hydrogen. The $5 billion plant there will be one of the world's largest. Helios, Air Products, ACWA Power. The players are serious. They are not dabbling.
The UAE is not far behind. ADNOC is pouring billions into blue and green hydrogen. They are targeting 25% of the global hydrogen market by 2030. That is not a rounding error. That is an ambition.
Why hydrogen? Because the Gulf has everything it needs. Sun. Wind. Land. And money. Lots of it. Green hydrogen requires renewable electricity. The Gulf has some of the best solar resources on Earth. Desalinated water? They have that too. And the cash to build electrolysers at scale.
But there is a catch. Hydrogen is expensive to produce. And harder to ship. The infrastructure is not there yet. The Japanese and Koreans are building ships for ammonia. But the supply chains are nascent.
That is where the politics gets interesting. The EU wants to import hydrogen. They have set targets. 10 million tonnes by 2030. But the EU is also keen on standards. 'Certified green.' The Gulf producers want to meet those standards. They are adapting.
Whitehall is watching. The UK has its own hydrogen strategy. But it is small beer compared to what the Gulf is planning. The question is whether Britain can partner with the Gulf. Or will it be left behind?
There are risks. The technology is unproven at scale. The market is fickle. And there is always the danger of the oil curse distorting everything. The Gulf states have seen booms and busts. Hydrogen could be another bubble.
But the smart money says not. The Gulf is diversifying. They are building a post-oil economy. Hydrogen is part of that. And they have the asset that matters most: cheap energy.
For now, the story is one of ambition. The details are still being written. But the direction is clear. The Middle East is pivoting. From black gold to green hydrogen. The rest of the world should pay attention.
More to follow.
