THIS MORNING: Yemen forces retake key strait coast, push toward Sanaa

Good morning, wonderful people. Every company in today’s issue has orders on the books and a cost problem filling them.

PIF-owned Folk Maritime has flattened its expansion, with Poul Hestbaek telling us disruption has pushed operating costs up by as much as 40% and made capacity hard to find at a price that works. Between shipping, vessels, leasing, fuel, and ins., costs are running high for the business.

But it’s not all stalled growth for business: September’s PMI hit the highest reading since February as new orders ran well ahead of what firms actually produced, which means a queue is building.

Others are expanding through agreements. Dubai-based merchant acquirer Neopay is buying its way into the Kingdom, agreeing to take a 65% controlling stake in Noon Payments, e-commerce platform Noon’s online gateway. The pitch to Saudi merchants is one provider for online and in-store payments, instead of a different acquirer and gateway in every market.

Meanwhile, Saudi banks are paying more for the deposits they already have. The 10 largest listed lenders took in more than they lent last quarter and did it through time deposits, which Alvarez & Marsal reads as pressure on funding costs and margins going forward. Provisions rose too. The price of money here is being set by competition for deposits more than by the rate cycle.

We’re honored to welcome Dr. Ahmed Heikal as a guest speaker at the 2026 EnterpriseAM Egypt Forum.

Dr. Heikal founded Qalaa Holdings in 2004, building it into Africa’s largest private equity firm with investments spanning 15 countries and 15 industries, before leading its transformation into a holding company spanning energy, cement, transportation & logistics, agrifoods, and mining. Along the way, he built more than 80 businesses across Egypt and Africa, including the Egyptian Refining Company, Egypt's largest private-sector-led infrastructure project, and has since exited more than 20 of them. He also founded the Qalaa Holdings Scholarship Foundation in 2007, which has supported more than 70k beneficiaries.

Earlier in his career, Heikal joined EFG Hermes in 1992 and played a key role in transforming the small financial consultancy into the leading investment bank in the Arab world and emerging markets, holding senior roles across asset management, investment banking, brokerage, and private equity before becoming an executive board member and Managing Director.

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War watch

Yemen’s government has retaken the coast along the Bab Al Mandab Strait and Dhubab Airport in southwest Yemen, and has launched a “strategic attack” on the capital. Saudi-backed government forces took control of Dhubab district in Taiz, which overlooks the strait, cutting off the road between it and Al Makha. They also captured Al Makha, as well as the towns of Bab and Hadeid. The campaign, which was announced over the weekend, aims to restore state institutions and retake Sanaa and other territories from Houthi control.

The heaviest fighting is in the southwest, where the Houthis advanced into parts of the mountain road to Taiz on Sunday, surrounding government forces. They also reportedly pushed into the town of Al Turbah, which sits atop a high promontory on the road, although a government source denied this. A Houthi-run agency claimed its fighters drove government forces from Al Mawasit district as well.

REMEMBER- Riyadh is making a new budget support disbursement of more than SAR 224 mn to the Yemeni government, according to a statement by the Saudi Development and Reconstruction Program for Yemen. The statement did not make an explicit connection between the financial support and Yemen’s military campaign against the Houthis.

Makkah pact coming into effect: Saudi Arabia, Turkey, and Pakistan, members of the Strategic Political and Defence Committee established under the Makkah Agreement for Joint Defence, will supply forces and capabilities for rapid deployment in the Kingdom, SPA reports. The committee has also appointed retired Pakistani lieutenant general Nauman Mahmood as the first secretary-general of the alliance for a three-year term. The member states strongly condemned the “attempted targeting of Makkah and Madinah” and the attacks on civilian and economic sites in Saudi Arabia.

PSA

The Interior Ministry has launched a campaign to get people and businesses to report security concerns. Called Balagh, it directs reporting to the Unified Security Operations Centers (911) and the Kollona Amn app, and includes a 60-day open call for the public and for public- and private-sector entities to produce awareness content — videos, infographics, and media pieces. It runs in partnership with Arabian Contracting Services, SPA reports.

Jeddah Tower delayed

The finish line for the world’s would-be tallest building has been pushed back. Jeddah Tower and the first phase of the city around it should be completed in “late 2028,” a few months behind last year’s August 2028 target, AGBI quotes Jeddah Economic Company CEO Fabien Toscano as saying at the Saudi Mega Projects summit in Riyadh. The tower reached 116 floors and about 466 meters high last month, with 41 of 157 still to be built.

The commercial timeline has slipped with it. Apartment sales are now set for 2027, and JEC is opening phase-one land talks at Cityscape in Riyadh in November.

The war has not been kind to construction and the squeeze reaches well beyond the tower. Mace — delivery partner on Qiddiya and program manager for the Kingdom’s stadium build — told us the war was a genuine supply-chain shock, rerouting cargo that once moved through Dammam the long way via the Red Sea and Jeddah; contractors have since ordered critical materials earlier and sourced more inside the Kingdom. Electrical cable is the stubborn holdout, in “big scarcity” and up as much as 26% y-o-y in July on Saudi Contractors Authority data. Middle East and Africa CEO Christopher Seymour puts the cost hit north of 10% on some projects and about 5% on others, and says the pressure is “being moderated,” though it has “not gone away.”

Running short

The world’s oil stockpiles have become “scarily thin,” and markets remain exposed until Hormuz fully reopens, Bloomberg quotes Saudi Aramco’s CEO Amin Nasser as saying at the Energy Intelligence Forum. His warning comes days after the G7 agreed to release up to 100 mn barrels of diesel and crude over four months to ease fuel prices.

Fewer than 6 bn barrels of commercial inventories remain, from almost 10 bn when the war began, Nasser said. Less than 10% of the world’s inventories are practically available because of technical restrictions, he added, which leaves a far smaller cushion than the headline figure suggests.

Emergency releases will not close the gap between supply and demand, Nasser warned. Rebuilding stocks would add at least 2 mn bbl / d of demand and could take up to two years, with more needed if governments hold larger reserves.

More crude is moving, but prices are not coming down. Seven major Gulf producers were set to ship 12.8 mn bbl / d in September, still some 6 mn bbl / d below February levels. Brent has traded around USD 100 per barrel over the past month, Nasser said, with Iranian attacks on ships in the strait and proxy attacks on Aramco infrastructure keeping supply risks in focus. Refined fuel prices have risen even more sharply than crude, he said.

Running as usual

The East-West oil pipeline is working normally, Bloomberg reports, citing people familiar with the matter, who denied reports that the flows had stopped again following a fresh attack on one of its pumping stations. Oil prices jumped as much as 1.2% after the disruption rumors, before easing again. Aramco had ramped up supplies through the 7 mn bbl / d pipeline to more than 80% of capacity by late last week, restoring much of the link after it was attacked by drones launched from Iraq in September.

REMEMBER- Since the US-Iran war disrupted flows through the Strait of Hormuz, the Kingdom had been routing around 4 mn bbl / d, or roughly 4% of global supply, through the East-West pipeline to Yanbu. Some of that crude was then shipped north through the Red Sea to Ain Sokhna in Egypt, transported via the Sumed pipeline and loaded at Sidi Kerir on the Mediterranean. Saudi crude flows through Sidi Kerir more than doubled to around 2.3 mn bbl / d in August. The East-West pipeline outage brought the entire route to a halt.

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The Gulf’s sovereign funds and largest companies are committing billions to AI infrastructure at home and to AI companies in the US and beyond. EnterpriseAM AI + Innovation reports on where that capital goes, who controls it and what it is actually buying.

Every Tuesday and Thursday, we also cover the startups and established firms across MENA putting AI to work, and how it is changing jobs, education and the way business runs.

It’s sharp, analytical and skeptical journalism that ignores hype and is laser-focused on informing our readers, not pleasing our sources.

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