economy
Gulf markets are splintering as the Iran war continues. Here's what to know
Investors are grappling with sharp divergence across the Gulf's markets, as the Iran conflict drives asset volatility in the region.
TL;DR
- Gulf markets have diverged sharply due to geopolitical turmoil and energy price swings since the Middle East conflict began.
- Saudi Arabia's index is up 5.8% and Oman's is up 9.3% since March 1, benefiting from high oil prices and safe-haven bids, respectively.
- Dubai's index has fallen nearly 16%, while Qatar and Bahrain have also experienced declines.
- Saudi Aramco benefits from its ability to export oil via pipelines to the Mediterranean, bypassing the Strait of Hormuz.
- Experts recommend caution, focusing on quality, resilient assets rather than taking excessive risks.
- Signs of de-escalation would boost investor sentiment, but a full resolution may take time.
- Dollar-pegged Gulf economies face inflation risks, and traditional safe havens like gold are acting more like risk assets.