Rig costs have been going up by as much as 430 per cent in some cases, and it is not hard to see why.

Before the current oil boom, the region was reluctant to commit to new exploration programmes, content to focus on pumping easily accessible oil. Over the past 20 years, only 3 per cent of exploration has taken place in the Middle East, which holds about 70 per cent of proven global reserves.

Now, after decades of under investment in energy exploration, and with much of the easily extractable oil disappearing fast, the Middle East is changing its attitude. National oil companies are looking to tap some of their more complex reservoirs to hit their production targets and add to their reserves.

Saudi Arabia has embarked on its largest ever exploration programme, while Iran and Iraq are looking to kick-start the involvement of oil majors in their oil and gas sector through fresh exploration campaigns.

Further west, Libya, Egypt and Algeria are all scrambling for rigs following landmark licensing rounds.

The high prices for rigs is the direct result of this rush to explore new areas. Fortunately for the region, the need to increase explor-ation activity is coinciding with record prices for oil on international markets, so the cost of hiring rigs can be easily absorbed.

The region is wise to reinvest some of its riches now, while the going is good, in order to better position itself for the next downturn.