Good morning, all. The two-week ceasefire is looking increasingly fragile by the hour and we’re bracing for the uncertainty of what comes next.

At home: Hours into the ceasefire announcement, the East-West pipeline — our only way to move oil around the once-again closed Strait of Hormuz — was hit in a drone attack, according to unconfirmed reports from the Financial Times and Bloomberg. Neither Saudi officials nor local media have addressed the reports and Aramco declined to comment on the matter when EnterpriseAM reached out.

REMEMBER- The Kingdom began rerouting crude exports to the Red Sea’s Yanbu port in early March to bypass the strait, and maxed out capacity on its East-West pipeline this week after pumping close to 5 mn barrels a day to the west coast. This helped us export around 50% of our normal oil volumes, but the pipeline shutting down, while Hormuz remains closed, could mean our oil exports will drop to near zero.

^^ We dive into what comes next for us and our neighbors in our big story today.

Happening today

EU High Representative and Vice-President Kaja Kallas kicked off a two-day visit to Saudi Arabia yesterday, according to an announcement. She is set to meet Saudi Foreign Minister Prince Faisal bin Farhan Al Saud and GCC Secretary-General Jasem Al Budaiwi.

UK Prime Minister Keir Starmer also landed in the Kingdom yesterday, the first stop of a Gulf tour aimed at reinforcing the Middle East ceasefire, Gulf News reports. On his first regional visit since the US-Israeli war against Iran began in February, the British leader is set to meet Crown Prince Mohammed bin Salman.

What to expect: Talks between the two leaders will likely center on supporting and extending the ceasefire, reopening the Strait of Hormuz, and advancing coordinated diplomatic efforts to bring the war to an end, alongside ongoing discussions around securing the critical waterway.

WEATHER- Stormy skies aren’t taking a break: Al-Baha, Asir, Jazan, and Najran can expect moderate to heavy thunderstorms, flash floods, hail, and winds whipping up dust and sand. The southern Makkah highlands will get a taste too, while Riyadh, Qassim, Hail, the Eastern Region, and Northern Borders should see milder action.

  • Riyadh: 29°C high / 19°C low;
  • Jeddah: 30°C high / 21°C low;
  • Makkah: 32°C high / 22°C low;
  • Dammam: 29°C high / 20°C low.

Watch this space

CAPITAL MARKETS — TASI catches ceasefire bid, but oil retreats cap gains: Tadawul’s benchmark index closed up 2.3% yesterday at 11.3k points after news of a two-week US-Iran ceasefire sparked a relief rally across regional markets, with the DFM (+7%), ADX (+2.8%), and EGX (+4%) all closing in the green. The move reverses a March selloff that the energy-heavy TASI largely managed to sidestep supported by higher oil prices.

A sign the war premium is evaporating? “Markets found much-needed relief [yesterday] as a pause in tensions allowed oversold sectors like real estate and transportation to rebound. Conversely, the energy and petrochemical industries saw declines as the war premium faded,” Junaid Ansari, director of investment strategy and research at Kamco Invest, tells EnterpriseAM.

The numbers tell the same story: Energy (-1.9%) was the only major sector in the red, with Aramco down roughly 2%, while high-beta petchem names like Petro Rabigh (-6.2%) and Yansab (-5.3%) saw significant selling pressure. Gains were led by media (+6.7%) and utilities (+5.6%), with ins. (+4.7%), transport (+4.5%), and capital goods (4.4%) also closing in the green.

MACRO — War drags our growth outlook down: The World Bank now sees our economy growing at a 3.1% clip this year, down 1.2 percentage points from its January forecast, according to its latest regional economic update (pdf). The Kingdom will see less pronounced deceleration owing to the “steady expansion of non-oil sectors and the possibility to divert exports away from the Strait of Hormuz,” the lender said.

The US-Iran war did a number on GCC projections. The lender slashed its growth forecast for the GCC to 1.3% in 2026, down from the 4.4% penciled in in January. Qatar and Kuwait dragged the forecast down, with both economies now expected to end the year in contraction. The most notable risks facing the Gulf are extended disruption to hydrocarbon exports, souring investor preferences, and reduced tourism, aviation, and maritime services.

TOURISM — The war may slash GCC tourism revenue by up to USD 32 bn: The ongoing military escalation in the region could cut tourist arrivals by 8-19 mn and reduce tourism revenues by USD 13-32 bn, Saudi Gazette reports, citing GCC Secretary General Jasem Albudaiwi at a GCC tourism ministers meeting.

Messe Frankfurt Saudi Arabia postponed this year’s Automechanika Riyadh, originally set for 4-6 May 2026, with plans to return in 2027 to account for the regional disruptions, according to a press release. The decision follows an “assessment of the current regional environment” to ensure the event can operate safely and at full international scale.

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The big story abroad

The global front pages remain fixated on the aftermath of what is shaping up to be a pretty fragile ceasefire agreement. We have more on that and what it means for us at home in the news well, below.

Oil is rising again: After the news of the ceasefire dragged oil prices down, fear that tensions could escalate again pushed prices up in early trading today. Brent crude rose 2.5% to USD 97.14 per barrel.

Meanwhile, in the world of AI: Tech giant Meta has debuted its first new model — Muse Spark — since CEO Mark Zuckerberg launched a multi-bn USD drive to bring on fresh AI talent. Pitched as an improved version of virtual assistant Meta AI, the new product claims to allow more personalized and visual responses and draws from content shared across Facebook, Instagram, and Threads.

And in the feud between Anthropic and the Pentagon, a Washington, DC, federal appeals court declined to obstruct the national security blacklisting of the AI ‌company. The move could block contractors who work with the Pentagon from using AI models by the startup. A separate appeals court had issued the opposite ruling in late March.

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