The global energy order is changing.
US President Donald Trump celebrated on Truth Social what he called the “biggest oil deal in history” – a 100-year concession on 17 oil fields in Venezuela that would secure 65 billion barrels of oil.
Around the same time, QatarEnergy informed Edison, one of its biggest European customers, that force majeure on its liquefied natural gas (LNG) deliveries would continue until early November. Five more cargoes were cancelled, taking the total to 29, or about 3.8 billion cubic metres of gas.
The contract has run since 2009 and normally covers roughly a tenth of Italy’s annual consumption. Edison has kept supplying its customers by finding replacement cargoes elsewhere, including in the US.
For decades, the bargain between Washington and the Gulf was clear. The US protected the region and kept its sea lanes open; Gulf producers supplied the energy on which the global economy depended and settled their sales in dollars to benefit the US economy.
That bargain has been turned on its head. America no longer simply protects Gulf energy. It competes with it, and increasingly profits when the Gulf cannot deliver due to insecurity.
Six months of war have reportedly impacted Qatar’s LNG exports significantly. Other Gulf countries like Kuwait, Saudi Arabia and the UAE have seen a substantial drop in oil exports as well. Meanwhile, US oil and gas have moved into the space left behind, with US energy giants raking in record-high profits.
It is important here to distinguish between the US as a government and the dense network of private interests that operates around it. Washington wants strategic leverage over Iran and continued influence over the Gulf states. Energy companies want access to reserves, favourable regulation, profitable prices and new customers. Trump brings the two together under the banner of energy dominance. State power opens the door; private capital walks through it.
Israel adds another layer. Chevron operates its two main offshore gas fields, owning almost 40 percent of the Leviathan gasfield and 25 percent of the Tamar gasfield. Leviathan is expanding after a $35bn agreement was signed last year to increase exports to Egypt.
Israel is therefore not an independent energy rival to the US in the way Qatar is. Its growing role as an Eastern Mediterranean gas hub is tied to a US operator and fits comfortably within a US-backed regional system linking Israel, Egypt and Jordan.
Chevron is the thread running through much of this story. It has major interests in US production, controls Israel’s most important gas assets and is positioned to expand in Venezuela. This does not mean Chevron determines foreign policy. It does show how easily the exercise of American power can translate into commercial opportunity for American companies.
Israel is also determined not to let the confrontation with Iran end on terms it considers not to be in its interest. The US-Iran memorandum of understanding signed in June fell well short of Israeli war aims. Israel said it was not bound by all its provisions, insisted on freedom of action in Lebanon and briefly resumed attacks while the US was trying to sustain negotiations.
For Israel, ceasefires have tended to be pauses, not settlements: opportunities to regroup while preserving the option of striking again. The reasons are chiefly strategic. Israel wants to prevent Iran from rebuilding its nuclear, missile and regional capabilities, while Israeli leaders fear accepting a deal and looking weak ahead of elections.
The consequences of Israel pushing for continuous conflict align with US energy interests. Continued pressure on Iran keeps the Strait of Hormuz insecure, Gulf exports vulnerable and risk premiums for energy transport high. Israel and US energy companies do not need to be following a common plan for their interests to reinforce one another.
Price is where the argument becomes clearest. Trump talks constantly about cheap oil, but US producers cannot prosper if it becomes too cheap. A Dallas Federal Reserve survey found that US companies needed an average price of about $43 a barrel to operate existing wells and $66 to drill new ones profitably. The two main Permian basins sit at roughly $61 to $62.
Trump therefore needs a narrow band: oil cheap enough to contain inflation, but expensive enough to keep shale, fracking and export investment alive. Gulf insecurity helps maintain it. The disruption need not be catastrophic. It only has to keep prices at a point where the next American well makes economic sense.
This may help explain the attraction of a no-war, no-peace outcome. A full regional war could close Hormuz, send prices soaring and threaten Chevron’s Israeli operations. A durable settlement would remove the risk premium, restore confidence in Gulf supply and limit Israel’s freedom of action.
Managed insecurity sits conveniently between the two: enough restraint to protect US-linked production, but not enough diplomacy to make Gulf energy entirely dependable again.
Israel keeps Iran under pressure. Washington retains leverage over its allies. US producers gain customers and commercially supportive prices. The danger lies in the convergence: Several powerful actors now have something to gain from preventing the crisis from reaching a final resolution.
The Gulf still holds vast reserves and enjoys production costs US companies cannot match. But reserves alone no longer decide market power. Reliability does. Only an estimated 3.5 to 5.5 million barrels a day can bypass Hormuz through Saudi and Emirati pipelines. The rest remains exposed to a single point of failure, despite decades of arms purchases, foreign bases and security guarantees.
The greatest threat to the Gulf’s energy future is not depletion. It is that customers learn to live without it. Every delayed tanker strengthens the case for an Atlantic alternative. Every Qatari cargo replaced by US LNG creates a relationship that may endure long after the war.
US power once rested partly on protecting the flow of Gulf energy. It now rests increasingly on replacing it.
The views expressed in this article are the author’s own and do not necessarily reflect Al Jazeera’s editorial stance.
