The real future of hydrogen in Oman begins

For years, green hydrogen has been portrayed as the next great pillar of the global energy transition — a clean fuel capable of decarbonising heavy industry, transforming shipping, and reshaping global trade. Countries released ambitious roadmaps, investors crowded into conferences, and companies raced to announce billion-dollar projects. For a moment, the world seemed to believe that hydrogen’s rise would be quick, smooth and unstoppable.
Then the tone shifted. Over the past two years, major energy companies — including BP, Shell, Engie and Equinor — have scaled back or cancelled some of their most high-profile hydrogen ventures. BP’s withdrawal from one of its planned green-hydrogen projects in Duqm mirrored similar moves in Europe, the UK, and Australia. It is one of two projects — the other being the HyDuqm venture backed by the ENGIE–POSCO-led consortium — that authorities recently confirmed had been shelved by mutual agreement. These announcements have prompted understandable questions: Is hydrogen losing momentum? Has the hype evaporated?
The truth is far more interesting. What we are witnessing is not the collapse of hydrogen, but the collapse of unrealistic expectations. The sector is not dying — it is maturing.

Global demand for hydrogen reached almost 100 million tonnes in 2024. Yet, as the International Energy Agency reports, less than one percent of that total is “clean” hydrogen produced from renewable energy. Most of the world’s hydrogen still comes from natural gas and coal, serving long-established industries that have yet to transition. The new markets expected to spark a surge in demand — green steel, low-carbon shipping, clean industrial heat — are progressing, but not fast enough to justify the pace of early project announcements.
This disconnect sits at the heart of today’s reset. Many of the large, ambitious projects launched between 2020 and 2023 were built on assumptions about rapid global uptake, generous subsidies and eager buyers. Yet buyers remain cautious, regulations are still evolving, and the infrastructure needed to transport and store hydrogen is far from complete. Without long-term purchase commitments, even promising projects struggle to attract financing.
Costs reinforce this slowdown. Producing green hydrogen remains significantly more expensive than producing conventional hydrogen. Electrolysers are still costly, and renewable electricity prices — while falling in some regions — remain volatile. With high global interest rates and investors seeking stable returns, capital naturally flows toward sectors that offer immediate profitability. For major oil and gas companies, hydrogen is a strategic option, not an operational necessity. When financial pressure rises, optional ambitions are the first to be paused.
Yet the withdrawal of some industry giants may ultimately be healthy for the sector. When companies that treated hydrogen as a peripheral experiment step aside, they leave space for players with genuine long-term conviction. These include industrial companies seeking to decarbonise production, renewable-energy developers whose futures depend on the transition, sovereign wealth funds investing with 20- to 30-year horizons, and countries that are building integrated hydrogen ecosystems rather than chasing headlines.
This shift helps filter the noise. The global pipeline of projects is now smaller, but those that remain are more serious, more grounded and more closely linked to real future demand. The hydrogen conversation has moved from marketing announcements to practical planning.
For Oman, this transition is not a setback but a moment of clarity. The cancellation of a pair of projects does not change the fundamentals that make the Sultanate one of the most promising emerging hydrogen hubs in the region. Oman possesses exceptional solar and wind resources, modern deep-water ports, competitively priced land, a strategic maritime location and, most importantly, a transparent and structured regulatory framework under Hydrom.
Unlike some countries that rushed to announce mega-projects, Oman has taken a measured path: building renewable-energy zones, integrating hydrogen into future industrial plans, developing export corridors and aligning all of this with Vision 2040. This approach recognises a simple truth — hydrogen is not a short-term opportunity, but a generational one.
The decisive chapter of the hydrogen economy will unfold between 2035 and 2050. The coming decade will involve refining technologies, lowering costs, strengthening supply chains and gradually expanding industrial demand. Like solar and wind before it, hydrogen will mature slowly and then grow quickly.
This moment is not a crisis in the hydrogen story — it is the necessary selection phase. The companies and countries that remain committed today are the ones positioning themselves at the centre of tomorrow’s clean-energy landscape. Oman is one of them.
Energy transitions are rarely linear. They advance in waves of enthusiasm, correction and renewal. What matters is not who enters the race first, but who stays when the excitement fades. That is how real energy systems are built — not with certainty, but with resilience.