GCC Stock Trading Patterns in 2026

Dangers are tilted to the downside. In the event of a prolonged conflict, the existing influence on the region will be compoundedthrough raised energy and food costs, decreasing trade, tourist and remittances, increased fiscal pressures, and displacement. "The present crisis is a stark tip of the work ahead for the area: not just to weather shocks, but to rebuild more resilient economies with stronger macroeconomic principles, innovate and improve governance, purchase infrastructure, and improve employment-creating sectors," said.

With peace and the right action, countries can construct the institutions, capabilities and competitive sectors that produce chances for people." With this long-lasting vision in mind, the report takes a close take a look at the area's potential for commercial policy federal government actions to increase tactical service activity as a motorist of financial growth and job creation.

ANSR July GCC PRs 50DR+

Federal governments in the region have actually embraced commercial policy at a high rate in the last years, frequently through sovereign wealth funds and state-owned business, but the results have been mixed. The report highlights the vital requirement for strong organizations and mindful targeting of policies. "As nations face the heavy toll of the present conflict, it is crucial to likewise not lose sight of the work required for lasting peace and success," said.

Upcoming Middle Eastern Economic Projections

Q2 2026: The ICAEW Economic Update Middle East, is a quarterly financial forecast for the region prepared directly for the financing occupation. The GCC economy faces a marked contraction this year pending details of the US-Iran contract to end the war. We expect energy flows, tourist and investor belief to slowly normalise as war interruptions decrease.

ANSR July GCC PRs 50DR+

The interim contract in between the United States and Iran is a substantial action towards reaching a full-blown deal. A complete go back to normality in the Strait of Hormuz will likely take time, however the danger of a recession-inducing oil price spike has actually decreased. Global GDP is anticipated to grow by 2.4% this year, 0.2 ppt less than we projected 3 months ago, and 3.1% in 2027.

We forecast a 4.1% contraction in Middle East GDP this year (versus forecasted 3.6% expansion before the war), higher than the decrease in the very first year of the Covid pandemic. Kuwait, Iran, Iraq and Qatar stand apart as the hardest hit, owing to their failure to prevent the interruption to local shipping, war-driven facilities damage and tourism losses.

Our 2026 outlook for the GCC is weaker than 3 months back, with GDP forecast to contract by 2.4% compared to a 0.2% decline forecasted previously. We anticipate Oman and Saudi Arabia to be the least negatively affected by the fallout from the conflict, with both economies continuing to expand this year.

The financial damage incurred in the last few months is significant. Saudi GDP information for Q1 revealed development slowed to 3% y/y, with non-oil activities expanding by 2.9%, the weakest rate since the Covid pandemic. On a seasonally changed basis, GDP contracted 1.2% q/q, driven by a 6.8% fall in oil activities as the Strait of Hormuz interruption struck late in the quarter.

Future-Proofing GCC Investments for 2026 Shifts

Aside from Oman, all GCC producers in addition to Iran and Iraq have actually suffered comprehensive oil and gas production losses since the start of the conflict. May data reveal local production nearly halved from pre-war levels, with the decrease deepening relative to March and April. Rerouting efforts, including by Saudi Arabia through the East-West Pipeline and the UAE through the Habshan-Fujairah pipeline, have actually assisted avoid an even bigger plunge in output.

ANSR July GCC PRs 50DR+

However, we forecast GCC oil sector output to agreement by 14.5% this year, which will mark the steepest decrease in numerous years. We then anticipate a 23.5% rebound next year, driven mainly by normalisation from a severely depressed base. Meanwhile, oil prices have actually been unstable, relieving below $85 per barrel as the interim arrangement was revealed.

In the medium term, we expect oil rates to be a little lower than our pre-war baseline, as the UAE's departure from OPEC+ permits a progressive boost in its output towards the 5mn barrel each day production target when trade normalises. Against this backdrop, the UAE will speed up the building of a new West-East pipeline that ought to double the capability of export through Fujairah.

The May PMI surveys reported output development reaching its strongest level in three months, driven largely by improved domestic demand. However, they remain listed below long-run averages, with weak export orders and cost pressures from higher material and transportation costs are a common style. In general, we expect a 1.1% contraction in GCC non-energy sectors this year (compared to 4.2% development pre-war) and a steady healing over the rest of the years.