Lates News

With the ongoing Iran war, if the conflict does not end in the short term, major Gulf economies including Saudi Arabia, the United Arab Emirates, and Qatar may face their most severe economic downturn since the 1990s. According to Farouk Soussa, an economist for Goldman Sachs in the Middle East and North Africa, if the conflict continues until April and leads to the closure of the Strait of Hormuz for two months, Qatar and Kuwait's GDP could shrink by 14% this year. This would be the most serious economic recession for these two countries since the early 1990s Gulf War. In contrast, Saudi Arabia and the UAE are in a relatively better position because they have the ability to transport oil through alternative routes. Nevertheless, these two countries may still face their most severe economic impact since the 2020 pandemic, with GDP expected to decrease by around 3% and 5% respectively. Soussa stated, "For many Gulf economies, the short-term impact of this war may be more severe than the pandemic. When the dust settles, they will rebuild and recover, but the scars left on market confidence by this conflict are still to be observed."