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Former Ambassadors have warned that global oil security and trade is under serious threat.

LONDON, UK, June 24, 2013 / -- Former Ambassadors have warned that global oil security and trade is under serious threat as a result of a complex mix of new political and security factors in both the Middle East and West Africa.

Ambassador Patrick Hayford, a former Ghana Ambassador to South Africa and former Director for Africa in United Nations Secretary-General Kofi Annan’s Executive Office and Sir William Patey KCMG, a former Ambassador to Afghanistan, Saudi Arabia, Iraq and Sudan and former Head of the Middle East Department in the Foreign Office issued the warning during a panel discussion at Lloyd’s of London on 18 June on The Middle East and West Africa: The Politics & Security of Oil.

The panel highlighted a number of factors which are increasingly impacting oil security and trade which they believe will cause a growing problem over the coming months and years:

• The steady unravelling of the nation-state structures established early in the twentieth century in the Middle East by Britain and France

• Repercussions of the deepening Sunni-Shia divide throughout the Middle East

• The likelihood of increasing threats to the security of physical infrastructure especially those relating to the oil and natural gas industries

• The growing sophistication of some of the militant extremist groups and their determination to cause the maximum damage through violent attacks

• The failure by countries in the Middle East and in West Africa to adopt and implement effective regional counter measures against the threat to oil and natural gas production and transportation

• Failure by West African coastal states to give sufficient attention to the establishment of effective coast guard capacity

The event coincided with an announcement by the BBC that day that piracy off the coast of West Africa has now overtaken Somali piracy and that “international efforts to tackle piracy off West Africa have been slow to take effect”.

The event, hosted by The Ambassador Partnership and Maritime Asset Security and Training (MAST) Ltd, included London based diplomats, UK government representatives, and from the private sector both the maritime and energy industries were represented along with underwriters, risk advisers, legal advisers, analysts and others.

Ambassador Patrick Hayford said, “The politics and security of oil in West Africa have become more complicated because all stakeholders involved are facing new challenges; oil companies face new financial disclosure requirements; the governments of West African oil producing states are under increased political pressure domestically; environmental groups are becoming more active; and the local communities in oil producing areas are more determined than ever to ensure that the resources benefit their own communities.”
Ambassador Hayford continued, “We are in a significantly changed environment in terms of the oil and gas industry in West Africa, and the African governments need to recognise this, and make the necessary adjustments, especially in their dealings with the local populations most affected by the exploitation of these natural resources.”

Ambassador Hayford added, “African governments need to do more in terms of strengthening security and protection of oil and natural gas facilities and the shipping lanes and pipelines.”

He noted that according to recent reports Nigeria loses approximately six billion dollars annually through oil theft.

He also stressed the need for a more vigorous and sustained public policy debate within Africa on these issues. He also stressed the need for Africa to tell its own story and fully recover its self-confidence.

Sir William Patey KCMG said, “Oil income helped cushion Saudi Arabia and other Gulf countries from the impact of the Arab Awakening but they will not be able to rely on ever increasing oil prices or the ability to increase production as other sources come on line including Iraq, Latin America and Iran. It will be important to make the necessary economic, political and social adjustments over the next decade to cope with an increasingly young population and their aspirations.”

Sir William also said, “Reduced reliance on Middle East oil is causing some understandable anxiety in the Gulf that the American security commitment to the Gulf will diminish. But oil is a globally traded commodity in which the US will continue to have a huge stake and in any case they have wider strategic interests in the area.”

Philip Cable, CEO of MAST, said: “There is no doubt that mankind’s reliance on oil and fossil fuels creates an inexorable tension between those that have such resources within their territory and those that do not. Organisations operating in these regions need to consider carefully how they will secure their staff and infrastructure and how they will cooperate with the domestic government.”

Sir Stephen Brown KCVO, Co-Chairman of The Ambassador Partnership, said: “As former Ambassadors we strive to uphold the values of increased transparency and absolute business integrity. We believe that the complex politics of oil producing states and those that work with them deserve special attention. We welcome this debate.”

Alistair Kellie
Newgate Communications
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