The Arab Energy Fund is stepping up its private equity activity as it seeks to drive a new wave of energy investments across the Middle East and beyond, according to a report by Bloomberg.

The fund, now known as TAEF, aims to boost combined equity and debt investments by 60% over the next three years, taking total exposure to about $12bn, chief executive Khalid Al-Ruwaigh said in an interview with Bloomberg.

TAEF plans to strike more direct private equity investments while also allocating capital to other funds investing in the region. The strategy reflects Gulf states’ efforts to diversify economies away from hydrocarbons and attract global capital into energy transition projects.

The fund has already partnered with BlackRock and participated in the $11bn deal for Saudi Aramco gas assets last year. It has also taken a minority stake in Arabian Petroleum Supply Co., which focuses on sustainable energy solutions, and is preparing to announce another agreement in the UAE.

Al-Ruwaigh said TAEF’s ability to deploy both debt and equity capital allows it to move quickly and take a more patient approach than traditional private equity firms. The fund was established in 1975 and operates as a financially independent entity, with most of its capital raised through bond issuance rather than government funding.

The push into private equity underscores how state-backed investors in the Gulf are increasingly using PE structures to accelerate dealmaking in renewables, project finance, and energy transition assets.

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