If we take a look across the worlds most important hotspots like Libya ( where sadly its overall oil production has been plunging to less than 500.000 barrels per day because of ISIS driven instability and the never ending struggle and clashes between 2 up to 3 warring militias and clans fighting to be the formal government and which have taken the whole oil and gas infrastructure as their ultimate prize, thus affecting its industry because of political and security risks) or if we come across the ongoing threat posed by ISIS AL QAEDA over Kurdistan Iraq oil production due to their struggle over controlling the majority of oil wells and refineries in Syria and Parts of Iraq and the even bigger threat of the most prominent oil and gas field in Saudi Arabia like Ghawar posed by some hypothetical shiite led or even ISIS Sunni inspired terrorist attack in the House of Saud's most difficult time ever and if ever accomplished this could make oil prices skyrocket on the basis of a strong psychological impact on the world oil markets to up to 150$ a barrel to say the least, all these previous examples showing that geopolitical and political risks be them internal or international are having a tremendous effect on the behaviour or world energy prices and landscape. Sure there are these and many other examples of this factor like how Nigeria has been strongly affected in its oil industry by the mix of BOKO HARAM and the MEND terrorist attacks against the off shore facilities affecting foreign personnel and its overall production or the cases of FARC attacks against oil pipelines in Colombia somewhat if not stopped soon, this could well represent a political and security threat to the surging and promising Colombian oil production rounding now the 1000000. barrels a day. Also another prominent case is Venezuela, which holds the worlds biggest heavy and extra heavy oil proven reserves at the Orinoco Belt, now it has been experiencing increasing levels of political risks and concerns of further deterioration of economic and financial situation in the country where possibly more foreign companies assets looms ahead and the security overall situation is critical all the actions taken by the State notwithstanding, could backlash and affect future investments so critically needed to fully develop the Orinoco belt reserves and where it's ostensible the presence and existence of political risks and being close to parliamentary elections the upcoming December, crucial for the stability of the status quo of the country. And also in the general southamerican oil and gas dynamics,political instability even if not longstanding is a phenomenon that should be considered in a continent with a strongly promising oil and gas production. And how about prolonged and protracted political turmoil and instability all across the MENA region and Eurasia and Central Asia and the Indian subcontinent, where terrorism, piracy in the sealanes and oceans, abrupt regime changes in a wider context home to large oil refineries pipelines power grids, altogether makes enough a perfect mix of increased political and security risk for the oil and gas industry.
So as long as there exists terrorist groups vying to make money and extort the states, as long as there is inefficient governments and deficient political systems without clear rules of law for investment, there will be enough room for. Political risks in the oil and gas industry to be assessed. So it's not and won't be only a matter of fundamentals but also of geopolitics in the world energy landscape.
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