The global economy has matured since the energy shocks of the 1970s and mid 2000s, but the perception remains that geopolitical crises in the Middle East could potentially send energy prices soaring at any moment. During last week’s Global Energy Outlook Forum 2024 hosted in Tokyo by Gulf Intelligence, 56% of participants surveyed said that geopolitical events are likely to disrupt Middle Eastern energy supplies in 2024, while 44% disagreed.

Perception is one thing and reality another. The fact is that since the end of the Arab oil embargo in the 1970s, Middle Eastern energy supplies to global markets have not faced serious disruption. Even during the U.S. war in Iraq (2003-2011), energy exports from the region remained stable.

Risk from armed conflict is now accepted as an inherent feature of trade with the Middle East. In fact, Japan, the world’s fourth-largest oil buyer, has increased its share of Middle Eastern oil, from 77% of the country’s total imports in 1973 to nearly 95% today.