War and the Oil Price Cycle

Complex rivalries for influence among regional powers, most notably between Saudi Arabia and Iran but also including Turkey, Qatar and the United Arab Emirates, are transforming the Middle East. As local borders and ruling institutions have become contested in the aftermath of the Iraq War and the Arab Spring, so has control of the region's major oil and gas facilities. Warring militias, the Islamic State of Iraq and Syria (ISIS), Al Qaeda and traditional governments are increasingly focusing on maintaining or gaining control of oil production and refining installations. Additionally, regional conflicts, now complicated by the active military involvement of Russia, have spilled over to affect global oil markets as Saudi Arabia and its Gulf allies, seeking to influence regional military and geopolitical outcomes, have initiated a market share war that has bought about a collapse of oil prices.