Beyond oil and gas: Middle East supplies the world with 30 critical products

Investing.com -- The Middle East plays a far larger role in global supply chains than oil and gas alone, according to a new note from Barclays analyst Zornitsa Todorova, who identified 30 critical products for which the region supplies more than 10 percent of global trade value.

Drawing on 2.8 million trade corridors and 1,200 products across 70 major economies, Todorova said the bank’s work highlights “material but underappreciated exposures across chemicals, construction, agriculture and basic manufacturing.” 

The analyst wrote that the region’s importance is “driven by key reliance on industrial inputs.”

Barclays found the Middle East supplies 62 percent of global limestone flux, around 50 percent of sulphur, 23 percent of nitrogenous fertilizers and roughly 20 percent of key petrochemical inputs. 

The bank stated that exposures “run deeper than energy,” with these industrial feedstocks flowing primarily to India, China and the U.S.

The analysis relies on the latest UN Comtrade release and tracks flows from nine Middle Eastern exporters, including Iran, Iraq, Saudi Arabia and the United Arab Emirates. 

Todorova noted that the dataset allows Barclays to identify “critical (or highly exposed) products as those for which these nine Middle East countries collectively account for more than 10% of the dollar value of total world supply.”

Barclays highlighted vulnerabilities in chemicals, such as methanol, aromatics, phenols and polyolefins, as well as construction materials like limestone, gypsum and aluminium products. 

Agriculture is also exposed via nitrogen, phosphate and compound fertilizers. 

“More niche but still material exposures exist in metals, shipping and luxury goods, including aluminium, vessels, diamonds and gold, where disruptions would potentially re-route trade flows rather than eliminate supply,” concluded Barclays.