Israeli soldiers prepare armed drones near Gaza. Israel Defence Forces says it thwarted a submarine drone attack from Gaza on the Tamar oil field. AFP
Israeli soldiers prepare armed drones near Gaza. Israel Defence Forces says it thwarted a submarine drone attack from Gaza on the Tamar oil field. AFP
Israeli soldiers prepare armed drones near Gaza. Israel Defence Forces says it thwarted a submarine drone attack from Gaza on the Tamar oil field. AFP
Israeli soldiers prepare armed drones near Gaza. Israel Defence Forces says it thwarted a submarine drone attack from Gaza on the Tamar oil field. AFP

Why drones pose a new threat to critical energy infrastructure


Robin Mills
  • English
  • Arabic

Live updates: Follow the latest news on Israel-Gaza

From the chariot to the longbow, gunpowder, the tank, aeroplane and nuclear bombs, military leaders have long sought invincible weapons.

A new arm has entered service, giving dangerous confidence to weaker forces, and used effectively by Hamas in its attack on Israel.

As Israel shuts down a key offshore gasfield, a proliferation of drones and guided cruise missiles threatens not just soldiers, but critical infrastructure providing energy supplies for modern life.

The rise of relatively humble, cheap but numerous Turkish-built drones was prominent in Azerbaijan’s speedy defeat of Armenia in September-November 2020.

Watch: Israel pounds Gaza after evacuation deadline expires

But from an energy viewpoint, such weapons proved their capability earlier.

Experience from clashes such as the Iran-Iraq war, when both sides pounded away at oilfields, refineries and terminals, suggested that relatively small energy targets were hard to damage with inaccurate unguided missiles, or by planes that were vulnerable to interception.

But in September 2019, drones and cruise missiles, claimed by Houthi forces in Yemen, but more likely coming from Iran or Iran-linked groups in Iraq, hit the Abqaiq oil-processing facility and Khurais oilfield in Saudi Arabia, evading radar and the Patriot missile defence system.

The strikes temporarily knocked out 5.7 million barrels per day of oil production.

They appeared to be carefully calibrated to avoid major permanent damage, and Saudi Arabia was able to restore full capacity within a few weeks.

The main effect was political, demonstrating Iran’s ability to cause severe disruption to energy facilities key not only for Saudi Arabia, but for global oil consumers.

Drones have again been prominent in the Russia-Ukraine war, and not just on the front lines.

Russia has repeatedly struck at Ukrainian electricity supplies, especially last winter, aiming to disrupt the economy and break morale.

Ukraine has hit back through a series of shadowy attacks and somewhat unexplained explosions at Russian refineries, fuel depots and power plants.

These drones are not just aerial. Ukraine has innovated with marine drones, used in a series of attacks on Russia’s Black Sea fleet, the Kerch Bridge to Crimea and, in August, oil tankers.

That leads to perhaps the most mysterious recent energy sabotage.

Last September, three of the four lines of the Nord Stream I and II gas pipelines running from Russia to Germany under the Baltic Sea were destroyed by explosions.

Every plausible and implausible candidate has been blamed, including Russia, Ukraine or pro-Ukrainian groups, Nato, the US and the UK, but no proof has emerged.

On Tuesday, another Baltic gas pipeline between Finland and Estonia was broken by an apparent explosion, which Finland blames on “outside activity”.

Neither this nor the Nord Stream sabotage had to be carried out by drone – explosives laid by divers, mini-submarines or remotely operated vehicles from ships are most likely.

But it does show the vulnerability of the increasingly dense network of subsea pipelines, electricity and fibre-optic cables, growing as grids are integrated and offshore wind farms advance.

Following Hamas’s surprise attack, Israel shut down the important Tamar gasfield, whose production platform can be seen from Gaza on a clear day.

Israel-Gaza war latest - in pictures

  • A Palestinian girl holds two children as she stands on a street in Gaza city as Israel continues to launch air strikes. AFP
    A Palestinian girl holds two children as she stands on a street in Gaza city as Israel continues to launch air strikes. AFP
  • Smoke plumes billow during Israeli air strikes on Gaza city. AFP
    Smoke plumes billow during Israeli air strikes on Gaza city. AFP
  • A Palestinian girl following an Israeli air strike in Khan Younis. Reuters
    A Palestinian girl following an Israeli air strike in Khan Younis. Reuters
  • Palestinians survey the rubble of a house destroyed in Israeli strikes in Khan Younis, in the southern Gaza Strip. Reuters
    Palestinians survey the rubble of a house destroyed in Israeli strikes in Khan Younis, in the southern Gaza Strip. Reuters
  • A Palestinian woman, covered in dust, carries a child in Gaza city. AFP
    A Palestinian woman, covered in dust, carries a child in Gaza city. AFP
  • A Palestinian man with a child outside al-Shifa hospital in Gaza city. AFP
    A Palestinian man with a child outside al-Shifa hospital in Gaza city. AFP
  • Israeli soldiers walk through Kibbutz Be'eri. Days earlier Hamas militants killed more than a hundred civilians near the border with Gaza. Getty Images
    Israeli soldiers walk through Kibbutz Be'eri. Days earlier Hamas militants killed more than a hundred civilians near the border with Gaza. Getty Images
  • A wounded Palestinian man Ala Al-Kafarneh, who survived Israeli strikes, attends a hospital in Gaza city. Mr Al-Kafarneh lost his pregnant wife and several members of his family in air strikes after they fled Beit Hanoun. Reuters
    A wounded Palestinian man Ala Al-Kafarneh, who survived Israeli strikes, attends a hospital in Gaza city. Mr Al-Kafarneh lost his pregnant wife and several members of his family in air strikes after they fled Beit Hanoun. Reuters
  • Supermarket shelves containing dry goods are left depleted in Tel Aviv. Getty Images
    Supermarket shelves containing dry goods are left depleted in Tel Aviv. Getty Images
  • An injured Palestinian man arrives at Al-Shefa hospital in Gaza city. EPA
    An injured Palestinian man arrives at Al-Shefa hospital in Gaza city. EPA
  • A boot lies on the ground outside a damaged house in Be'eri, Israel. EPA
    A boot lies on the ground outside a damaged house in Be'eri, Israel. EPA
  • An Israeli army self-propelled howitzer near the border with Gaza in southern Israel. AFP
    An Israeli army self-propelled howitzer near the border with Gaza in southern Israel. AFP
  • Palestinian mourners during the funerals of Al-Agha family members killed in Israeli strikes in Khan Younis in the southern Gaza Strip. Reuters
    Palestinian mourners during the funerals of Al-Agha family members killed in Israeli strikes in Khan Younis in the southern Gaza Strip. Reuters
  • Family and friends of May Naim, 24, who was killed by Palestinians militants at a party near the Israeli border with the Gaza Strip, during her funeral in Gan Haim, Israel. Getty Images
    Family and friends of May Naim, 24, who was killed by Palestinians militants at a party near the Israeli border with the Gaza Strip, during her funeral in Gan Haim, Israel. Getty Images
  • Palestinian children in Khan Younis fill bottles with water from public taps during the conflict with Israel. Reuters
    Palestinian children in Khan Younis fill bottles with water from public taps during the conflict with Israel. Reuters
  • Men outside a morgue in Khan Yunis console a woman mourning loved ones killed in an Israeli air strike. AFP
    Men outside a morgue in Khan Yunis console a woman mourning loved ones killed in an Israeli air strike. AFP
  • A Palestinian girl injured in Israeli strikes is taken to hospital in Gaza City. Reuters
    A Palestinian girl injured in Israeli strikes is taken to hospital in Gaza City. Reuters
  • An Israeli woman is evacuated by paramedics following a rocket attack launched from the Gaza Strip into Israel, in Sderot. Reuters
    An Israeli woman is evacuated by paramedics following a rocket attack launched from the Gaza Strip into Israel, in Sderot. Reuters
  • A man looks at the destruction in the ravaged Jabalia refugee camp, following overnight Israeli air strikes. AFP
    A man looks at the destruction in the ravaged Jabalia refugee camp, following overnight Israeli air strikes. AFP
  • The daughter of Zakaria Abu Maamar, a member of Hamas's political office, at her father's funeral, after he was killed in an air strike in Khan Younis. Reuters
    The daughter of Zakaria Abu Maamar, a member of Hamas's political office, at her father's funeral, after he was killed in an air strike in Khan Younis. Reuters
  • A collapsed building after an Israeli bombardment in Gaza City. AFP
    A collapsed building after an Israeli bombardment in Gaza City. AFP
  • Firefighters attend a burning building after an Israeli bombardment in Gaza City. AFP
    Firefighters attend a burning building after an Israeli bombardment in Gaza City. AFP
  • Women and children in Gaza City. AFP
    Women and children in Gaza City. AFP
  • An Israeli army soldier passes a Merkava battle tank in northern Israel near the border with Lebanon. AFP
    An Israeli army soldier passes a Merkava battle tank in northern Israel near the border with Lebanon. AFP
  • An Israeli strike on the port of Gaza City. AFP
    An Israeli strike on the port of Gaza City. AFP
  • Demonstrators outside the West Los Angeles Federal Building in California during a rally in support of Israel. AFP
    Demonstrators outside the West Los Angeles Federal Building in California during a rally in support of Israel. AFP
  • Mourners at the funeral of Palestinians killed in overnight Israeli shelling in Khan Younis in Gaza. AFP
    Mourners at the funeral of Palestinians killed in overnight Israeli shelling in Khan Younis in Gaza. AFP
  • Israeli journalists take cover during a rocket attack from Gaza in the southern Israeli kibbutz of Kfar Aza near the border. AFP
    Israeli journalists take cover during a rocket attack from Gaza in the southern Israeli kibbutz of Kfar Aza near the border. AFP
  • Palestinians rescue a young girl from the rubble of a destroyed residential building following an Israeli air strike. AP
    Palestinians rescue a young girl from the rubble of a destroyed residential building following an Israeli air strike. AP
  • Mourners at the graveside of Eden Guez, who was killed as she attended a festival that was attacked by Hamas gunmen from Gaza. Reuters
    Mourners at the graveside of Eden Guez, who was killed as she attended a festival that was attacked by Hamas gunmen from Gaza. Reuters
  • An Israeli fireman recovers after extinguishing cars set on fire by a rocket fired from Gaza. AP
    An Israeli fireman recovers after extinguishing cars set on fire by a rocket fired from Gaza. AP
  • Smoke billows from a boat after a strike by Israel on the port of Gaza City. AFP
    Smoke billows from a boat after a strike by Israel on the port of Gaza City. AFP
  • Destroyed residential buildings in Gaza City. AP
    Destroyed residential buildings in Gaza City. AP
  • Rockets from Gaza launched towards Israel. Reuters
    Rockets from Gaza launched towards Israel. Reuters
  • A Palestinian woman sits among the rubble in the destroyed Al-Ramal neighborhood following an Israeli air strike in Gaza City. EPA
    A Palestinian woman sits among the rubble in the destroyed Al-Ramal neighborhood following an Israeli air strike in Gaza City. EPA
  • Israeli soldiers in armoured vehicles near the northern town of Kiryat Shmona close to the border with Lebanon. AFP
    Israeli soldiers in armoured vehicles near the northern town of Kiryat Shmona close to the border with Lebanon. AFP
  • Buildings destroyed by Israeli strikes in Gaza city. Reuters
    Buildings destroyed by Israeli strikes in Gaza city. Reuters
  • Nicole Izsak, right, confronts a Palestinian supporter near the Israeli consulate in New York, claiming her cousin is being held hostage in Gaza. AFP
    Nicole Izsak, right, confronts a Palestinian supporter near the Israeli consulate in New York, claiming her cousin is being held hostage in Gaza. AFP
  • The abandoned site of the Supernova music festival, besieged by Hamas militants in southern Israel. AFP
    The abandoned site of the Supernova music festival, besieged by Hamas militants in southern Israel. AFP
  • An attack on the site by Hamas gunmen from Gaza left at least 260 people dead. Reuters
    An attack on the site by Hamas gunmen from Gaza left at least 260 people dead. Reuters
  • A man carries a blood-stained flak jacket belonging to a Palestinian journalist, who was killed with two colleagues when an Israeli missile hit a hospital building while they were outside reporting, in Gaza city. Reuters
    A man carries a blood-stained flak jacket belonging to a Palestinian journalist, who was killed with two colleagues when an Israeli missile hit a hospital building while they were outside reporting, in Gaza city. Reuters
  • An Israeli soldier holds a rescued dog as he takes position near a bomb shelter in Kibbutz Kfar Aza, southern Israel. Reuters
    An Israeli soldier holds a rescued dog as he takes position near a bomb shelter in Kibbutz Kfar Aza, southern Israel. Reuters
  • Protesters chant and wave the Palestinian flag at a rally in Melbourne, Australia. Getty Images
    Protesters chant and wave the Palestinian flag at a rally in Melbourne, Australia. Getty Images
  • Israeli border police walk past a burnt-out car as rockets are launched from the Gaza Strip towards Israel, in Ashkelon, southern Israel. Reuters
    Israeli border police walk past a burnt-out car as rockets are launched from the Gaza Strip towards Israel, in Ashkelon, southern Israel. Reuters
  • Palestinians amid the rubble following Israeli air strikes that razed a neighbourhood in Gaza city. AP
    Palestinians amid the rubble following Israeli air strikes that razed a neighbourhood in Gaza city. AP
  • Palestinians carry a wounded man at Al Shifa Hospital in Gaza city. EPA
    Palestinians carry a wounded man at Al Shifa Hospital in Gaza city. EPA
  • Palestinians inspect damage in the aftermath of Israeli strikes in Khan Younis, southern Gaza Strip. Reuters
    Palestinians inspect damage in the aftermath of Israeli strikes in Khan Younis, southern Gaza Strip. Reuters

This was apparently precautionary. The facilities for Israel’s two other producing fields, Leviathan and Karish, are located much further north, near the Lebanese offshore border.

Tamar was also briefly closed during the unrest of May 2021, albeit that was much less serious.

The Israel Defence Forces claimed to have thwarted a submarine drone attack from Gaza on Tamar, and that rockets had also been unsuccessfully fired at the platform.

In July 2022, the IDF said it had downed three reconnaissance drones launched by Hezbollah towards the Karish floating production vessel.

On Saturday, unofficial reports suggested the much-watched Qana well, being drilled by France’s TotalEnergies in Lebanon just over the boundary line, had failed to find gas.

That remains to be confirmed but, if true, it would dampen the incentive for Hezbollah to avoid targeting Israeli energy infrastructure for fear of retaliation.

Tamar provides nearly half of Israel’s gas production, and contributes to its exports to Jordan and Egypt.

In turn, Egypt had been in the process of resuming liquefied natural gas exports, helping to supply Europe.

For now, there is no reason to expect the closure to be prolonged, but if it were, it would tighten global gas supplies as the Northern Hemisphere winter approaches.

European gas prices have risen by more than half since last Saturday, mostly because of the ominous Baltic pipeline rupture.

Drones have several advantages. They can be cheap and simple, well within the capability of weaker or poorer states as well as non-state groups.

Therefore they can be deniable, making it hard for the target to know who to retaliate against and how.

There are no easy answers to this new threat: the energy industry and defence forces need to learn quickly and be prepared for the unexpected and even the previously unthinkable
Robin Mills

They can overwhelm expensive conventional defences with a combination of numbers and undetectability. And they avoid exposing their users directly to harm.

Their main weakness is dependence on GPS systems and communications from human operators, which can be blocked by electronic measures.

That may disappear as fully autonomous drones, micro-drones and swarms are deployed. Drone attacks are also more effective when teamed with guided missiles and bombs, cyberwarfare, and traditional ground forces and misdirection.

New weapons win battles and even campaigns, but rarely provide a durable strategic advantage.

Opponents adopt them, or find ways to counter them. Nevertheless, they can lead countries or armed groups to start conflicts against apparently much stronger opponents. They also change the nature and targets of warfare.

Both the Middle East and Europe abound in exposed energy infrastructure. Defences can be beefed up, and critical systems can be hardened.

Ukraine’s experience in keeping much of its heat, water and electricity flowing even through prolonged attacks is testament to the value of robustness, duplication and improvisation.

Still, there are no easy answers to this new threat: the energy industry and defence forces need to learn quickly and be prepared for the unexpected, and even the previously unthinkable.

Robin M. Mills is chief executive of Qamar Energy, and author of The Myth of the Oil Crisis

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%3Cp%3E%3Cstrong%3EDirector%3A%3C%2Fstrong%3E%20Christopher%20McQuarrie%3Cbr%3E%3Cstrong%3EStars%3A%3C%2Fstrong%3E%20Tom%20Cruise%2C%20Hayley%20Atwell%2C%20Pom%20Klementieff%2C%20Simon%20Pegg%3Cbr%3E%3Cstrong%3ERating%3A%3C%2Fstrong%3E%204%2F5%3C%2Fp%3E%0A
Ballon d’Or shortlists

Men

Sadio Mane (Senegal/Liverpool), Sergio Aguero (Aregentina/Manchester City), Frenkie de Jong (Netherlans/Barcelona), Hugo Lloris (France/Tottenham), Dusan Tadic (Serbia/Ajax), Kylian Mbappe (France/PSG), Trent Alexander-Arnold (England/Liverpool), Donny van de Beek (Netherlands/Ajax), Pierre-Emerick Aubameyang (Gabon/Arsenal), Marc-Andre ter Stegen (Germany/Barcelona), Cristiano Ronaldo (Portugal/Juventus), Alisson (Brazil/Liverpool), Matthijs de Ligt (Netherlands/Juventus), Karim Benzema (France/Real Madrid), Georginio Wijnaldum (Netherlands/Liverpool), Virgil van Dijk (Netherlands/Liverpool), Bernardo Silva (Portugal/Manchester City), Son Heung-min (South Korea/Tottenham), Robert Lewandowski (Poland/Bayern Munich), Roberto Firmino (Brazil/Liverpool), Lionel Messi (Argentina/Barcelona), Riyad Mahrez (Algeria/Manchester City), Kevin De Bruyne (Belgium/Manchester City), Kalidou Koulibaly (Senegal/Napoli), Antoine Griezmann (France/Barcelona), Mohamed Salah (Egypt/Liverpool), Eden Hazard (BEL/Real Madrid), Marquinhos (Brazil/Paris-SG), Raheem Sterling (Eengland/Manchester City), Joao Félix(Portugal/Atletico Madrid)

Women

Sam Kerr (Austria/Chelsea), Ellen White (England/Manchester City), Nilla Fischer (Sweden/Linkopings), Amandine Henry (France/Lyon), Lucy Bronze(England/Lyon), Alex Morgan (USA/Orlando Pride), Vivianne Miedema (Netherlands/Arsenal), Dzsenifer Marozsan (Germany/Lyon), Pernille Harder (Denmark/Wolfsburg), Sarah Bouhaddi (France/Lyon), Megan Rapinoe (USA/Reign FC), Lieke Martens (Netherlands/Barcelona), Sari van Veenendal (Netherlands/Atletico Madrid), Wendie Renard (France/Lyon), Rose Lavelle(USA/Washington Spirit), Marta (Brazil/Orlando Pride), Ada Hegerberg (Norway/Lyon), Kosovare Asllani (Sweden/CD Tacon), Sofia Jakobsson (Sweden/CD Tacon), Tobin Heath (USA/Portland Thorns)

 

 

Warlight,
Michael Ondaatje, Knopf 

Water waste

In the UAE’s arid climate, small shrubs, bushes and flower beds usually require about six litres of water per square metre, daily. That increases to 12 litres per square metre a day for small trees, and 300 litres for palm trees.

Horticulturists suggest the best time for watering is before 8am or after 6pm, when water won't be dried up by the sun.

A global report published by the Water Resources Institute in August, ranked the UAE 10th out of 164 nations where water supplies are most stretched.

The Emirates is the world’s third largest per capita water consumer after the US and Canada.

The specs

  Engine: 2-litre or 3-litre 4Motion all-wheel-drive Power: 250Nm (2-litre); 340 (3-litre) Torque: 450Nm Transmission: 8-speed automatic Starting price: From Dh212,000 On sale: Now

German intelligence warnings
  • 2002: "Hezbollah supporters feared becoming a target of security services because of the effects of [9/11] ... discussions on Hezbollah policy moved from mosques into smaller circles in private homes." Supporters in Germany: 800
  • 2013: "Financial and logistical support from Germany for Hezbollah in Lebanon supports the armed struggle against Israel ... Hezbollah supporters in Germany hold back from actions that would gain publicity." Supporters in Germany: 950
  • 2023: "It must be reckoned with that Hezbollah will continue to plan terrorist actions outside the Middle East against Israel or Israeli interests." Supporters in Germany: 1,250 

Source: Federal Office for the Protection of the Constitution

Muslim Council of Elders condemns terrorism on religious sites

The Muslim Council of Elders has strongly condemned the criminal attacks on religious sites in Britain.

It firmly rejected “acts of terrorism, which constitute a flagrant violation of the sanctity of houses of worship”.

“Attacking places of worship is a form of terrorism and extremism that threatens peace and stability within societies,” it said.

The council also warned against the rise of hate speech, racism, extremism and Islamophobia. It urged the international community to join efforts to promote tolerance and peaceful coexistence.

What is dialysis?

Dialysis is a way of cleaning your blood when your kidneys fail and can no longer do the job.

It gets rid of your body's wastes, extra salt and water, and helps to control your blood pressure. The main cause of kidney failure is diabetes and hypertension.

There are two kinds of dialysis — haemodialysis and peritoneal.

In haemodialysis, blood is pumped out of your body to an artificial kidney machine that filter your blood and returns it to your body by tubes.

In peritoneal dialysis, the inside lining of your own belly acts as a natural filter. Wastes are taken out by means of a cleansing fluid which is washed in and out of your belly in cycles.

It isn’t an option for everyone but if eligible, can be done at home by the patient or caregiver. This, as opposed to home haemodialysis, is covered by insurance in the UAE.

SERIE A FIXTURES

Saturday (UAE kick-off times)

Atalanta v Juventus (6pm)

AC Milan v Napoli (9pm)

Torino v Inter Milan (11.45pm)

Sunday

Bologna v Parma (3.30pm)

Sassuolo v Lazio (6pm)

Roma v Brescia (6pm)

Verona v Fiorentina (6pm)

Sampdoria v Udinese (9pm)

Lecce v Cagliari (11.45pm)

Monday

SPAL v Genoa (11.45pm)

MATCH INFO

Day 1 at Mount Maunganui

England 241-4

Denly 74, Stokes 67 not out, De Grandhomme 2-28

New Zealand 

Yet to bat

Saturday's results

West Ham 2-3 Tottenham
Arsenal 2-2 Southampton
Bournemouth 1-2 Wolves
Brighton 0-2 Leicester City
Crystal Palace 1-2 Liverpool
Everton 0-2 Norwich City
Watford 0-3 Burnley

Manchester City v Chelsea, 9.30pm 

The Bloomberg Billionaire Index in full

1 Jeff Bezos $140 billion
2 Bill Gates $98.3 billion
3 Bernard Arnault $83.1 billion
4 Warren Buffett $83 billion
5 Amancio Ortega $67.9 billion
6 Mark Zuckerberg $67.3 billion
7 Larry Page $56.8 billion
8 Larry Ellison $56.1 billion
9 Sergey Brin $55.2 billion
10 Carlos Slim $55.2 billion

Meydan racecard:

6.30pm: Al Maktoum Challenge Round 2 (PA) Group 1 | US$75,000 (Dirt) | 2,200 metres

7.05pm: UAE 1000 Guineas (TB) Listed | $250,000 (D) 1,600m

7.40pm: Meydan Classic Trial (TB) Conditions $100,000 (Turf) 1,400m

8.15pm: Al Shindagha Sprint (TB) Group 3 $200,000 (D) 1,200m

8.50pm: Handicap (TB) $175,000 (D) 1,600m

9.25pm: Handicap (TB) $175,000 (T) | 2,000m

10pm: Handicap (TB) $135,000 (T) 1,600m

Benefits of first-time home buyers' scheme
  • Priority access to new homes from participating developers
  • Discounts on sales price of off-plan units
  • Flexible payment plans from developers
  • Mortgages with better interest rates, faster approval times and reduced fees
  • DLD registration fee can be paid through banks or credit cards at zero interest rates
LILO & STITCH

Starring: Sydney Elizebeth Agudong, Maia Kealoha, Chris Sanders

Director: Dean Fleischer Camp

Rating: 4.5/5

Mercer, the investment consulting arm of US services company Marsh & McLennan, expects its wealth division to at least double its assets under management (AUM) in the Middle East as wealth in the region continues to grow despite economic headwinds, a company official said.

Mercer Wealth, which globally has $160 billion in AUM, plans to boost its AUM in the region to $2-$3bn in the next 2-3 years from the present $1bn, said Yasir AbuShaban, a Dubai-based principal with Mercer Wealth.

Within the next two to three years, we are looking at reaching $2 to $3 billion as a conservative estimate and we do see an opportunity to do so,” said Mr AbuShaban.

Mercer does not directly make investments, but allocates clients’ money they have discretion to, to professional asset managers. They also provide advice to clients.

“We have buying power. We can negotiate on their (client’s) behalf with asset managers to provide them lower fees than they otherwise would have to get on their own,” he added.

Mercer Wealth’s clients include sovereign wealth funds, family offices, and insurance companies among others.

From its office in Dubai, Mercer also looks after Africa, India and Turkey, where they also see opportunity for growth.

Wealth creation in Middle East and Africa (MEA) grew 8.5 per cent to $8.1 trillion last year from $7.5tn in 2015, higher than last year’s global average of 6 per cent and the second-highest growth in a region after Asia-Pacific which grew 9.9 per cent, according to consultancy Boston Consulting Group (BCG). In the region, where wealth grew just 1.9 per cent in 2015 compared with 2014, a pickup in oil prices has helped in wealth generation.

BCG is forecasting MEA wealth will rise to $12tn by 2021, growing at an annual average of 8 per cent.

Drivers of wealth generation in the region will be split evenly between new wealth creation and growth of performance of existing assets, according to BCG.

Another general trend in the region is clients’ looking for a comprehensive approach to investing, according to Mr AbuShaban.

“Institutional investors or some of the families are seeing a slowdown in the available capital they have to invest and in that sense they are looking at optimizing the way they manage their portfolios and making sure they are not investing haphazardly and different parts of their investment are working together,” said Mr AbuShaban.

Some clients also have a higher appetite for risk, given the low interest-rate environment that does not provide enough yield for some institutional investors. These clients are keen to invest in illiquid assets, such as private equity and infrastructure.

“What we have seen is a desire for higher returns in what has been a low-return environment specifically in various fixed income or bonds,” he said.

“In this environment, we have seen a de facto increase in the risk that clients are taking in things like illiquid investments, private equity investments, infrastructure and private debt, those kind of investments were higher illiquidity results in incrementally higher returns.”

The Abu Dhabi Investment Authority, one of the largest sovereign wealth funds, said in its 2016 report that has gradually increased its exposure in direct private equity and private credit transactions, mainly in Asian markets and especially in China and India. The authority’s private equity department focused on structured equities owing to “their defensive characteristics.”

Updated: October 16, 2023, 3:00 AM