The growing relationship between artificial intelligence and energy is reshaping the UAE's investment landscape, as rising electricity demand and advances in AI technology create new opportunities for energy companies and investors.

According to Nagham Hassan, Market Analyst at etoro, AI and energy are becoming increasingly dependent on each other, turning the UAE's oil, gas and power companies into technology stories as well as commodity ones.

This growing relationship was a key theme at this year's Adipec, where Dr Sultan Al Jaber, Adnoc's Managing Director and Group CEO, highlighted the potential for AI to transform the energy industry. Adnoc also announced a multi-year partnership with OpenAI and G42 to use AI to accelerate oilfield development planning and improve decisions across production, refining and trading.

AI's hunger for electricity

"AI's hunger for electricity is growing fast, and the International Energy Agency expects data centres worldwide to use roughly twice as much power by 2030 as they did last year," said Hassan.

"Asked at Adipec to name his biggest challenge, OpenAI CEO Sam Altman answered with one word: energy. This suggests access to power may become as important as computing capacity in setting the pace of AI's expansion, which favours countries that can add generation quickly."

In the UAE, Masdar and the Emirates Water and Electricity Company are developing a solar-and-battery project designed to deliver power around the clock from 2027. Adnoc has also cited AI infrastructure as one reason for expanding gas production, pointing to potentially stronger long-term demand for gas and clean power as data centres become a major source of electricity consumption.

Reducing engineering effort

Beyond meeting growing energy demand, AI is also changing how energy companies operate. Adnoc says its AI-enabled operations centre, connecting more than 120 rigs, has reduced engineering effort by 30% to 40%. Such efficiency gains could help companies lower operating costs, particularly as shipping disruptions continue to put pressure on logistics expenses.

For investors in UAE-listed companies, Hassan identifies two areas worth watching: businesses supplying the gas and electricity needed to power data centres, and energy companies using AI to improve operational efficiency.

Adnoc Gas has identified AI data centres as a driver of UAE gas demand in its latest annual report, while Adnoc Drilling already operates its first AI-enabled offshore rig.

Meanwhile, Presight holds a 51% stake in AIQ, the energy-focused AI company established by Adnoc and G42. AIQ developed ENERGYai, a system that analyses Adnoc's oil and gas reservoirs and forms part of the technological foundation for the new OpenAI partnership.

Spending turning into results

"What investors need to see next is this spending turning into results: data-centre capacity coming online on schedule, new long-term gas and power supply contracts, and companies reporting measurable AI savings in their earnings," Hassan concluded.

As the UAE continues to invest in both AI and energy infrastructure, the ability to supply reliable power while using AI to improve productivity could become an increasingly important factor in the investment outlook for the country's energy sector.—TradeArabia News Service