Gulf’s Energy Investments
Economic growth in the GCC region is expected to accelerate in the year 2025. The World Bank expects the region to have a GDP growth of 4.2% in 2025-2026, driven by economic diversification and strategic reforms. The region is positioned to significantly outperform global GDP growth of 2.7% in 2024 and 2.8% in 2025.
The GCC’s energy market is set for a strong rebound in 2025 following favourable oil prices, continued investment into oil and gas projects, the new sector and the energy transition.
The region is expected to see huge investments in expansion of its upstream and downstream production capacity. The projects pipeline is vast. With over $470bn of oil, gas and petrochemicals projects planned across the wider Mena region, abundant EPC opportunities will be available for contractors in the year ahead. The largest project spending will be offered in Saudi Arabia’s expansion phases to develop the Jafurah basin and the Qatar LNG expansion programme.
Regional integration in the GCC countries lately have resulted in a more stable business environment. The business landscape across the region is evolving, creating new opportunities for growth and innovation.
The GCC continues its growth journey from being global oil and gas suppliers to energy transition leaders by diversifying into other forms of energy. Decarbonization, renewables and clean energy are part of its long-term strategic vision now.
The Gulf region is expected to attract over $75bn in renewable energy investments between 2025 and 2030. More than 7 GW of solar power capacity installation is expected by the end of 2025. The Kingdom of Saudi Arabia has set an ambitious target to reach 130 GW of renewable capacity by 2030, up from around 8 GW currently.
The GCC's green hydrogen industry is set to grow rapidly due to improved economic activity. The region has some of the world’s most ambitious hydrogen production projects.
Saudi Arabia is targeting green and blue hydrogen production of 2.9 million tons a year (tpy) by 2030 and 4 million tpy by 2035. The $500bn NEOM project includes plans for a clean industrial hub called Oxagon, featuring the “world’s largest green hydrogen facility” at a cost of $8.4bn. The UAE, aims to produce 1.4 million tpy of green and blue hydrogen by 2031. Oman aims to become a major green hydrogen producer and exporter with its strategic investments in green hydrogen projects – valued at around $40bn –targeting annual production of 1mn-1.25 million tpy of green hydrogen by 2030.
The key drivers of the GCC’s transformation are its Vision plans, which encompass a wide range of objectives, including developing non-oil sectors, promoting private sector investment, and enhancing social and environmental sustainability. Saudi Arabia’s Vision 2030 is one example of the region’s commitment to diversification and innovation.
The GCC offers a dynamic investment landscape across energy and industrial sectors. Governments are backing large-scale investment programmes. The projects’ outlook seems brighter going ahead.
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