Somaliland: A Rising Strategic Node in Global Oil Security and Geopolitics

As crude oil prices surge to multi-month highs, driven by escalating tensions between Israel and Iran, the geopolitical landscape is becoming increasingly complex and uncertain. In this volatile environment, a lesser-known but strategically vital player has emerged: Somaliland. Somaliland, a self-declared republic of around 5 million people in the Horn of Africa, has maintained relative stability for over three decades, with functioning institutions and regular democratic elections. However, it remains unrecognized internationally due to Washington's long-standing "one Somalia" policy. This stance may be shifting, with some policymakers in Washington reportedly contemplating a change in recognition of Somaliland. One influential policy blueprint, Project 2025, advanced by the Trump administration, suggests that formal recognition of Somaliland could serve as a hedge against growing Chinese influence in neighboring Djibouti. Djibouti hosts the only permanent U.S. military base on the African continent but has also become a key node in China’s Belt and Road Initiative, hosting Beijing’s first overseas military base. Its location at the Bab-el-Mandeb Strait makes it a prized maritime asset. Somaliland's new president, Abdirahman Mohamed Abdullahi, recently told The Guardian that the U.S. and other international partners may soon have to rethink their stance on Somalia. "We are a partner in security, in counter-terrorism, and in ensuring safe marine routes for global commerce," he added. There is speculation that Somaliland's recognition may come before 2028 as the Trump administration recalibrates its Africa policy. Beyond its strategic location, Somaliland's untapped hydrocarbon potential has also caught the attention of international investors. Norwegian firm TGS previously estimated that the Somali basin—which encompasses parts of Somaliland's onshore and offshore territories—could hold up to 30 billion barrels of oil. However, exploration efforts remain hampered by regional instability and security concerns. British-Turkish firm Genel Energy acquired exploration rights back in 2012 but has faced setbacks and been forced to suspend activities in certain areas due to emerging threats. As global supply chains grow increasingly fragile, the international community may find itself compelled to reconsider Somaliland’s status—not merely as a diplomatic footnote, but as a critical node in securing oil flows and countering rising instability in some of the world’s most volatile regions. In conclusion, the rise of Somaliland as a strategic node in the global oil market is not only a geopolitical development but also a significant shift in how we view the world's most volatile regions. With its strategic location and untapped potential for oil and gas, Somaliland is poised to become a key player in securing global energy flows and countering instability in the Middle East and beyond.