Insurers Flock to Oil Projects Outside the Middle East
India Targets Five Small Modular Reactors by 2033 What I Cover Tsvetana Paraskova is an energy and commodities journalist who has contributed to Oilprice.com for nearly a decade, covering global energy markets, commodities,… Global insurers had just shaken off the ESG push from earlier this decade when the Middle East conflict upended oil and gas upstream project coverage.
The world’s lowest-cost oil and gas producing region became a war zone at the end of February, with war-risk premiums and oil and gas drilling and construction projects facing either delays or significant cost inflation.
Five months of uncertainties about new oil and gas projects in the Middle East have prompted insurance giants to turn to underwriting drilling and project construction ventures outside the prolific but highly volatile region.
And the race is on for attracting insurance business in oil and gas basins less exposed to geopolitical flare-ups.
Insurers are slashing premiums on upstream energy insurance for projects not depending on the on-and-off closed Strait of Hormuz and other chokepoints in the Middle East.
Insurers Compete for Underwriting Projects Outside Middle East Premiums for upstream energy insurance outside the Middle East have tumbled by about 25% year to date, insurance brokers told theFinancial Times.
In some cases, some insurers have slashed the premiums by as much as 50%, even at a short-term loss, according to industry insiders who spoke to FT.
The reason is clear—as oil and gas companies boost exposure to basins and projects outside the Middle East, insurers are competing for a market share of the now-shrunk global pool of upstream developments that are not in an active war zone.
“Upstream [energy] has been a very profitable sector for the market for a number of years,” Rupert Mackenzie, a natural resources insurance broker at WTW, told FT.
Related: Oil Prices Climb Toward $100 as Red Sea Risks Rise “The view from insurers is, this is a sector which they would like to have ongoing exposure,” the broker added.
Mackenzie’s colleagues at WTW said in an Aprilreport, Energy Market Review 2026, that “ratings are ‘through the floor’”.
This year, “15–20% reductions are available for core upstream risks with clean loss histories and substantial premium on the slip, with 40%+ reductions still observed in exceptional cases,” WTW said in its annual report published a month and a half after the Iran war began.
| Product | Price | Change |
|---|---|---|
| Brent Crude | $102.14/bbl | +0.34% |
| WTI Crude | $96.90/bbl | +0.21% |
| EN590 Diesel | $846/MT | +0.18% |
| Jet Fuel A-1 | $1090/MT | +0.55% |
| Mazut M100 | $450/MT | -0.15% |
| Bitumen 60/70 | $470/MT | +0.08% |
| Sulphur Gran 99.5% | $470/MT | -0.44% |
| Urea 46% Gran | $650/MT | +1.12% |
| NPK 16-16-16 | $460/MT | -0.28% |
| Nat Gas TTF | $15.42/MMBtu | +0.92% |
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