Once a premium destination for overseas investors, Turkey’s power sector has recently been struggling with the impact of lower-than-expected growth rates, partial market liberalisation and fixed, long-term natural gas contracts. Power generation firms face further stress as the economic impact of the pandemic bites. Efforts to arrange a new debt restructuring deal have been delayed by the virus and wider economic woes, casting uncertainty over future demand. However, the sector retains some high-grade assets, however, which may attract future investor interest.
Saudi Aramco’s recent proposed investment in Sempra Energy’s liquefied natural gas (LNG) export project in Port Arthur, Texas, is indicative of the growing power of the US in the global energy market. The surge in US oil production has already had a major impact on the Middle East: the oil price crash which began in 2014 put an end to a 12-year period of budgetary comfort for MENA oil exporters, largely because of the extra US output. That country’s rapid climb up the ranks of the world’s LNG exporters is now an important factor in the calculations of many regional economies in which natural gas is of strategic importance, whether in the domestic energy mix or as an export commodity.