Oman’s natural gas sector is undergoing significant evaluation as domestic demand rises alongside efforts to transition toward cleaner energy sources, industry leaders said. Abdulrahman al Yahyaei, CEO of Integrated Gas Company (IGC)—the sole aggregator and shipper of natural gas in the Sultanate—highlighted ongoing discussions surrounding the pricing, allocation, and utilization of gas amid shifting market conditions.

Al Yahyaei emphasized that increased pressure on supply is prompting authorities to reassess domestic gas pricing frameworks. International natural gas prices have surged in recent years due to geopolitical factors and evolving energy market dynamics. In response, Oman is exploring pricing reforms aimed at enhancing efficiency and reflecting the full economic value of gas use within the country.

“Domestic gas pricing is an important policy question,” al Yahyaei said, noting that global price changes and opportunity costs necessitate adjustments to encourage efficient consumption and responsible management of the resource. He also underscored the need for pricing mechanisms that maintain Oman’s competitiveness and attractiveness to strategic industrial investors. The move appears to be toward more transparent, value-based pricing structures, moving away from broad subsidies.

Alongside pricing considerations, al Yahyaei pointed to growing interest among industrial consumers in reducing their reliance on natural gas. He cited increased adoption of energy efficiency measures, electrification, integration of renewable energy sources, and lower-carbon production methods as key trends emerging in the sector.

Some companies are reportedly investigating the use of hydrogen, renewable electricity, and process optimization techniques as strategies to enhance competitiveness and meet international sustainability standards. According to al Yahyaei, such efforts help alleviate demand pressures by freeing up gas volumes for higher-value applications.

Export-oriented industries in particular appear motivated by the rising global importance of environmentally sustainable products, driving a shift toward greener production models. Meanwhile, renewable energy projects, including utility-scale solar and wind installations, are gradually impacting Oman’s energy mix by reducing gas consumption during periods of generation.

“Solar helps during daylight hours, but the system still requires gas-fired generation for evening peaks, seasonal demand and system stability,” al Yahyaei explained.

The CEO indicated that ongoing deployments of additional renewables and electricity storage solutions are expected to further ease demand on gas supplies. Nonetheless, natural gas will continue to play a crucial role in ensuring the reliability and flexibility needed throughout the energy transition.

Seasonal electricity demand remains one of the most significant challenges for the gas infrastructure. High temperatures during summer months drive up air-conditioning load, sharply increasing gas consumption by the power sector and underscoring the need for careful management of resources.