Energy Security and Sustainability in the GCC : The Conditional and Contested Role of AI and Digital Infrastructure

ABSTRACT

As Gulf Cooperation Council (GCC) economies pursue simultaneous commitments to national AI strategies, renewable energy targets, and Paris Agreement pledges, a key sustainable‐management question remains empirically unresolved: does digital and AI investment genuinely advance energy security and environmental sustainability in hydrocarbon‐dependent economies, or does its contribution depend on institutional conditions policymakers can shape? This study provides a second‐generation panel econometric answer, analyzing all six GCC states from 1996 to 2023 ( N  = 168). Three contributions distinguish this work: we separate digital infrastructure (DII) from AI‐specific deployment (ADI) as econometrically distinct constructs; we introduce the Climate Stress Index (CSI), extending environmental assessment beyond CO ₂ accounting to vulnerability and disaster exposure; and, using estimators suited to a small, cross‐sectionally dependent panel (CCEMG, AMG) alongside country‐level, leave‐one‐out, placebo, and cross‐validated machine‐learning checks, we show energy efficiency and hydrocarbon revenue dependence, not digitalization per se, are the most robust levers of GCC energy security, a result validated against a placebo null distribution and corroborated by independent machine‐learning rankings. Digital infrastructure and AI deployment show smaller, estimator‐sensitive, and governance‐conditional associations; we report this conditionality transparently rather than overstating a still‐emerging relationship. Governance quality is the strongest Granger‐causal driver of energy security in the panel. For sustainable management practice, the findings reframe GCC digital strategy: AI investment should be sequenced alongside, not as a substitute for, energy‐efficiency policy, revenue diversification, and governance strengthening. We provide quantified policy guidance for GCC governments and a transparent, replicable template for evaluating digital‐sustainability claims in other resource‐dependent, small‐N‐panel economies.