Bahrain is comprised of a group of small islands in the energy-rich Persian Gulf. The country’s economy is highly dependent on the oil sector, with oil revenues amounting to about two-thirds of total government revenues. While Bahrain is a net exporter of oil, it is the smallest Middle East oil producer by volume, and unlike other Gulf states, Bahrain exports refined petroleum products rather than crude oil. Domestically, the vast majority of Bahrain’s total energy consumption comes from natural gas, with the remainder supplied by oil. Hydrocarbons also provide the foundation for Bahrain’s two major industries: refining and aluminum smelting. With demand for energy rising and domestic production falling, Bahrain will become increasingly dependent on oil and gas imports unless it can increase domestic production.