Sadara pulls plug on Jubail production on Hormuz disruptions

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WHAT WE’RE TRACKING TODAY

Benefit Street Partners is still wagering on the Gulf

Good morning, ladies and gents. Supply chain realities are hitting home as we lead today’s issue with Sadara Chemical Company pulling the plug on production at its USD 20 bn Jubail complex, thanks to feedstock disruptions in the Strait of Hormuz.

Watch this space

PRIVATE CREDIT — Benefit Street Partners is pressing ahead with its Gulf expansion plans despite the ongoing war with Iran, CEO David Manlowe told Semafor. The USD 92 bn Franklin Templeton subsidiary is currently “actively progressing various options that enable us to supply private capital into the region.” These routes include partnerships or JVs with local banks or funds — either alongside Franklin Templeton or independently as Benefit Street Partners, Manlowe said.

The war is no bar to the region’s long-term appeal: The conflict has “no impact on our excitement about going all in on the region,” Manlowe said, emphasizing a decades-long perspective on the Gulf. Benefit Street Partners expects the market to grow steadily, with potential to launch a dedicated Middle East fund, he added.

Why it matters: The move suggests that global private credit is separating long-term regional growth from immediate geopolitical risks. With strong demand for capital from infrastructure and data center projects persisting, as well as local banks tightening lending amid liquidity pressures, specialized lenders like Benefit Street Partners see a window to fill the gap.

BACKGROUND- The past few years saw the entry and expansion of several big players like Brookfield, KKR, Goldman Sachs, and Apollo. Franklin Templeton last year partnered with the Public Investment Fund to invest USD 5 bn in the Kingdom.

DEFENSE — European defense tech startups are fast-tracking talks with Gulf states to boost the region’s counter-drone and missile systems, company executives told CNBC. The lineup includes Estonia’s Frankenburg Technologies, the UK’s Valarian and Cambridge Aerospace, and Ukrainian-UK startup Uforce. The push gained traction last month when the UK government connected 13 British defense firms — including Frankenburg, Uforce, and Cambridge Aerospace — with GCC officials to talk shop on defensive hardware.

The firms are meeting the moment: Frankenburg Technologies is negotiating multi-national interceptor orders that could scale into the thousands and plans to accelerate delivery schedules, CEO Kusti Salm told the news outlet. Defense and cybersecurity specialist Valarian, which had no Gulf contracts before the war, is seeing a spike in regional interest, CEO Max Buchan said. Meanwhile, Uforce CEO Oleg Rogynskyy confirmed a similar surge in GCC demand for their autonomous defense systems.

… and rapidly accelerating local headcounting: To meet demand, Uforce deployed a Ukrainian delegation to the Middle East and plans to hire 5-10 permanent employees in the coming weeks. Meanwhile, Frankenburg, which previously had no staff in the region, is planning to hire a substantial local team.

ALSO- Sky Sabre, the UK’s most advanced short-range air defense system, is being deployed to Saudi Arabia, according to a statement. Able to intercept 24 targets at once at speeds over 3.7k km/h, it will be integrated into the national network to counter Iranian missiles and drones. It will also be accompanied by a Royal Artillery battery and Sky Sabre operators who are scheduled to move into Saudi bases this week.

The Gulf stands to gain on two fronts — by securing scalable, advanced solutions to bolster defense capabilities against immediate threats and by encouraging more European defense firms to set up permanent regional operations, thereby boosting foreign investment sentiment.

IPO — Petrolube’s IPO gets the regulatory green light: Petrolube Oil — the manufacturing arm of the local industrial oils giant Petromin — will take a 30% stake (represented by 9 mn shares) to the market after its IPO was approved by the Capital Market Authority. We’ll be on the lookout for the company’s prospectus for more details on the offering.

Data point

7.3 mn bbl / d — that’s how much OPEC oil output dropped m-o-m in March, reaching 21.57 mn bbl / d, according to a Reuters survey. This marks the lowest production level since June 2020, due to a massive cut from Iraq and smaller cuts from Saudi Arabia, Kuwait, and the UAE.

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The big story abroad

The news cycle remains fixed on the war in our region, but there may be an end in sight, with US President Donald Trump telling reporters that US forces will leave Iran in two to three weeks. Washington has been able to disable Tehran’s nuclear infrastructure, which will take up to 20 years to re-establish, Trump said.

Watch this space: Trump will deliver “an important update on Iran” in a national address scheduled for early tomorrow.

The resulting energy supply shock still holds sway, with US gasoline prices surpassing USD 4 per gallon — but investors remain confident that the Federal Reserve won’t be hiking rates anytime soon. Instead, investors anticipate the Fed will hold rates or potentially pivot to cuts later this year, wagering that rising energy costs are more likely to stifle economic growth than trigger inflation.

Meanwhile, in the world of AI: OpenAI raised USD 122 bn in a record-breaking funding round, raising its valuation to USD 852 bn. “AI is driving productivity gains, accelerating scientific discovery, and expanding what people and organizations can build. This funding gives us the resources to continue to lead at the scale this moment demands,” the company behind ChatGPT said. The round was led by Japan’s SoftBank.

ALSO WORTH NOTING THIS MORNING- US private equity firms are increasingly showing interest in Japan’s fast food industry. Notable investments include Carlyle Group’s USD 847 mn purchase of KFC’s Japan-based operations and Goldman Sachs’ JPY 70 bn acquisition of the country’s Burger King operations. The trend appears to be underpinned by demographic shifts and rising inflation, which make quick, convenient meals more appealing.

Sadara halts Jubail production as Hormuz disruptions cripple feedstock flow

Supply chain disruption just claimed a big victim: Sadara Chemical Company — the USD 20 bn JV between Saudi Aramco and Dow — pulled the plug on production at its Jubail complex. Sadara’s subsidiary announced the temporary shutdown in a filing to the Saudi Exchange yesterday, saying they have no clear timeline for when they’ll be able to restart.

The culprit? The ongoing conflict with Iran is strangling the region’s supply chains.

Management noted that bringing the plant back online is entirely contingent on “domestic and international factors,” while also warning investors that the freeze will drag down its financial results for the year.

Why it matters

The shutdown is a red flashing light for the global petrochemical industry. The flow of critical feedstocks like crude oil and naphtha through Hormuz has slowed to a trickle, and the Kingdom has already been forced to curtail its oil output. The pipeline designed to bypass the strait and pump crude to our western ports is reportedly maxed out at full capacity.

This will not just hurt Sadara: The Jubail complex typically churns out about 3 mn tons of plastics and chemicals every year, feeding everything from auto manufacturing to global packaging. Aramco CEO Amin Nasser has long championed the facility as a flagship project essential for squeezing more value out of Saudi oil and gas.

The math doesn’t look good: Some 30% of global ethylene supplies could be disrupted because of the conflict, according to BloombergNEF estimates.

Starting to see a pattern: The Sadara shutdown is the third major operational freeze by a listed company recently. It comes on the heels of Ades and Arabian Drilling suspending several of their offshore rigs.

What’s next? Pundits are warning that we’re likely just at the beginning of this wave. “I think we will see more shutdowns of petrochemical plants in the Middle East for the same reasons stocks will be building down the manufacturing chain,” Joseph McDonnell, oil analyst at Energy Aspects, told Bloomberg.

Net FDI inflows jump 90% y-o-y in 4Q 2025

Net inflows of foreign direct investment (FDI) in the Kingdom climbed 90% y-o-y to SAR 48.4 bn in 4Q 2025, according to data (pdf) from Gastat. On a quarterly basis, FDI net inflows rose 82% from 3Q 2025.

FDI inflows reached around SAR 50.6 bn in 4Q 2025, marking a 29% y-o-y increase and a 69% rise from 3Q. Meanwhile, FDI outflows stood at SAR 2.2 bn, down 84% y-o-y and 33% q-o-q.

For the full year, FDI net inflows totaled SAR 122.4 bn, according to the data. Inflows were relatively steady in the first half of the year, increased modestly in 3Q, and surged sharply in 4Q, which accounted for nearly 40% of total annual inflows. The total FDI inflows for the year amounted to SAR 133.3 bn.

MEANWHILE- FDI outflows for the year totaled SAR 10.9 bn. Outflows were moderate in the first three quarters, peaked slightly in 3Q, and declined in 4Q, reflecting steady but moderate outward investment activity.

BACKGROUND- The Kingdom introduced a series of reforms to attract FDI over the last year, including rent freezes, opening property ownership to foreigners, capital market liberalization, and a privatization strategy. Authorities are targeting USD 100 bn in annual FDI by 2030, a goal that’s increasingly looking out of reach after regional tensions erupted.

ALSO- 3Q figures were revised

FDI net inflows for 3Q 2025 were revised upward to SAR 26.6 bn from SAR 24.9 bn. Inflows were also revised to SAR 29.9 bn, up from SAR 27.7 bn, while outflows increased to SAR 3.3 bn from SAR 2.7 bn.

Ades lands SAR 2.7 bn contract in Nigeria

Ades Holding signed multi-year contracts to provide offshore drilling services in Nigeria. The contractor will deploy three premium jackup rigs for the West African Exploration & Production Company under a SAR 2.73 bn (USD 729 mn) agreement.

What’s in store? Each rig is contracted for three years, with an option to extend for two more. Operations are set to begin in the second half of 2026, with Nigeria's Valiant Offshore supporting with manpower and logistics.

Pushing forward with the strategy: Increased offshore activity and the strategic deployment of rigs across both existing and new markets helped push the company’s bottom line above analyst expectations to reach SAR 818 mn in 2025, while revenue went up 7.9% y-o-y to SAR 6.7 bn.

More backup: The expansion hedges against the halt of operations at several of Ades’ offshore drilling rigs in the GCC amid regional tensions that blocked transit through the Strait of Hormuz. The company says the firm’s steady geographic footprint — 123 rigs across 20 countries — will allow it to absorb local shocks without derailing the long-term growth trajectory.

Jarir Marketing’s bottom line climbs in 2025

Jarir Marketing reported a 7.7% y-o-y rise in net income to SAR 1.1 bn in 2025, supported by higher sales, which offset increased selling, marketing, administrative, and non-operating expenses, it said in a Tadawul disclosure. Revenue climbed 7% y-o-y to SAR 11.4 bn during the year, driven by strong smartphone demand, alongside growth in after-sales services and computer and tablet segments.

Dividends: The company will distribute SAR 312 mn in dividends for 4Q 2025 at SAR 0.26 per share, it said in a separate disclosure. The payout is scheduled for Wednesday, 15 April.

Emaar, The Economic City

Emaar, The Economic City narrowed its losses to SAR 9 mn in 2025, down from SAR 1.1 bn a year prior, thanks to higher revenues, the reversal of impaired losses, and loan restructuring, it said in a Tadawul disclosure. Its top line climbed 167.1% y-o-y to SAR 1.1 bn on the back of higher residential land sales and more lease contracts.

Baan Holding Group

Baan Holding Group ended 2025 in the red, recording around SAR 202 mn in losses, compared to a net income of SAR 5.2 mn seen the prior year, according to a Tadawul disclosure. The decline coincided with impairment losses, intense competition, and ins. compensation. The firm’s revenues dropped around 4.4% y-o-y to SAR 649 mn for the 12-month period, which management attributed to a dip in hospitality revenues.

Senaat

Advanced Building Industries (Senaat) saw its net income climb 276.9% y-o-y last year, reaching SAR 101 mn, thanks to higher sales and lower financial costs, it said in a Tadawul disclosure. The firm’s revenues remained almost unchanged at SAR 6.2 bn for the period.

Red Sea International

Red Sea International’s net losses narrowed to SAR 55 mn in 2025, compared to SAR 62 mn in 2024, it said in a Tadawul disclosure. The company attributed the losses to provisions on impaired assets and slow-moving inventories. Its revenues rose around 13.1% y-o-y to some SAR 3.4 bn for the same period.

Self-driving taxis get a route expansion

The Transport General Authority (TGA) inaugurated a new route for self-driving taxis linking Hayat Mall to Riyadh Gallery, the authority said on X. The expansion follows a pilot phase that saw over 1.7k trips and transported more than 3k passengers across 30k km.

More details: The vehicles are equipped with advanced safety, sensing, and camera systems that monitor roads, detect obstacles, and respond to traffic conditions.

Alramz to set up SAR 650 mn real estate fund

Alramz Real Estate has signed an agreement with Oud Capital to set up a SAR 650 mn real estate investment fund, which will be dedicated to building a residential project in Jeddah’s Al Firdous district, it said in a Tadawul disclosure. The project — named Al Ramz Front — will include about 900 housing units. The shariah-compliant fund will be managed by Oud Capital.

How much is the war costing the region?

A month of high-intensity military escalation is enough to derail the Arab States’ development trajectory, according to a high-level UNDP preliminary assessment report (pdf), which estimates up to USD 194 bn in GDP losses across the region. The study warns that even a “short-lived” month-long conflict is currently generating profound, persistent socio-economic scars.

Regional GDP is estimated to contract by 3.7% to 6%. Economic shocks from trade, energy, and finance are exacerbating already existing systemic weaknesses in the region when it comes to “economic diversification, dependence on external markets, [labor] market composition, and fiscal capacity,” the report highlights. The impacts are mainly felt through higher prices and inflationary pressures, which will “erode real incomes.”

A surge in poverty will be the starkest human impact, with nearly 4 mn additional people at risk of falling below the poverty line under high-intensity scenarios. The Levant, Sudan, and Yemen are the epicenter, accounting for roughly 75% of this spike (up to 3.3 mn people).

There are wider human repercussions too: The Human Development Index (HDI), which measures key indicators like life expectancy, living standard, and education, is projected to drop by 0.2-0.4%, effectively erasing six to 12 months of development progress. In the Levant, that setback is more severe, potentially rolling back the clock by 1.5 years.

Unemployment is expected to rise by 1.8% to 4%, equivalent to 1.6 mn to 3.6 mn lost jobs. Unskilled workers are likely to bear the brunt of it, particularly in the GCC, where the labor market remains highly exposed to external shocks.

The GCC and the Levant face the sharpest macroeconomic contractions, with both subregions expected to lose between 5.2% and 8.7% of their GDP. Sustaining stability now requires moving beyond hydrocarbon-heavy balance sheets toward diversified production bases and “shock-proof” logistics capable of surviving a closed strait, UN Assistant Secretary-General and Director of the UNDP Regional Bureau for Arab States Abdallah Al Dardari explained.

MARKETS THIS MORNING-

Asia-Pacific markets are up this morning following hopeful comments from US President Donald Trump regarding a potential end to the Iran war. Japan’s Nikkei is up almost 4%, and South Korea’s Kospi rose by more than 6%. Over on Wall Street, futures are trading higher.

TASI	11,250	+0.7% (YTD: +7.2%)
MSCI Tadawul 30	1,514	+0.7% (YTD: +9.1%)
NomuC	22,705	-0.8% (YTD: -2.5%)
USD : SAR (SAMA)	USD 3.75 Sell	USD 3.75 Buy
Interest rates	4.25% repo	3.75% reverse repo
EGX30	45,322	+0.3% (YTD: +8.4%)
ADX	9,521	-0.1% (YTD: -4.7%)
DFM	5,434	-0.2% (YTD: -10.1%)
S&P 500	6,529	+2.9% (YTD: -4.6%)
FTSE 100	10,176	+0.5% (YTD: +2.5%)
Euro Stoxx 50	5,570	+0.5% (YTD: -3.8%)
Brent crude	USD 103.97	-3.2%
Natural gas (Nymex)	USD 2.89	+0.1%
Gold	USD 4,719	+0.9%
BTC	USD 68,252	+2.2% (YTD: -22.1%)
Sukuk/bond market index	914.04	-0.8% (YTD: -0.6%)
S&P MENA Bond & Sukuk	149.02	+0.2% (YTD: -1.9%)
VIX (Volatility Index)	25.27	-17.5% (YTD: +72.4%)

THE CLOSING BELL: TADAWUL-

The TASI rose 0.7% yesterday on turnover of SAR 7.2 bn. The index is up 7.2% YTD.

In the green: Cenomi Retail (+10.0%), Malath Ins. (+9.9%), and Saptco (+9.9%).

In the red: Theeb (-6.9%), Spimaco (-6.4%), and City Cement (-5.3%).

THE CLOSING BELL: NOMU-

The NomuC fell 0.8% yesterday on turnover of SAR 36.6 mn. The index is down 2.5% YTD.

In the green: Paper Home (+12.6%), Almodawat (+9.8%), and Alnaqool (+9.3%).

In the red: Altwijri (-18.7%), Lana (-10.0%), and Naas Petrol (-9.9%).

CALENDAR

APRIL

20-22 April (Monday-Wednesday): Sports Investment Forum (SIF), Riyadh.

20-22 April (Monday-Wednesday): Future Aviation Forum, Riyadh.

MAY

3-9 May (Sunday-Sunday): The Global Sustainability Expo, The Arena Riyadh Venue.

19-21 May (Tuesday-Thursday): The Saudi Entertainment and Amusement Expo, Riyadh Front Exhibition and Conference Center.

24-28 May (Sunday-Thursday): Eid Al Adha holiday.

JUNE

15-17 June (Monday-Wednesday): Aluminum Arabia, The Arena, Riyadh.

21-24 June (Sunday-Wednesday): Saudi Food Exhibition and Conference, Riyadh Front Expo.

21-24 June (Sunday-Wednesday): Saudi Print & Pack, Riyadh International Convention & Exhibition Center.

21-24 June (Sunday-Wednesday): Riyadh International Industry Week, Riyadh International Convention & Exhibition Center.

21-24 June (Sunday-Wednesday): Saudi Plastics & Petrochem, Riyadh International Convention & Exhibition Center.

21-24 June (Sunday-Wednesday): Saudi Smart Logistics, Riyadh International Convention & Exhibition Center.

22-24 June (Monday-Wednesday): The Future Hospitality Summit, Mandarin Oriental Al Faisaliah Hotel, Riyadh.

JULY

6 July-23 August (Monday-Sunday): Esports World Cup, Riyadh.

AUGUST

31 August-3 Sep (Monday-Thursday): Leap Tech Conference, Riyadh Exhibition & Convention Center - Malham.

SEPTEMBER

9-10 September (Wednesday-Thursday): Procurement and Supply Chain Futures Forum, Mandarin Oriental Al Faisaliah Hotel, Riyadh.

9-10 September (Wednesday-Thursday): Real Estate Supply Chain Forum, Mandarin Oriental Al Faisaliah Hotel, Riyadh.

15-17 September (Tuesday-Thursday) The Global AI Summit, King Abdulaziz International Convention Center, Riyadh.

23 September (Wednesday): Saudi National Day.

OCTOBER

12-15 October (Monday-Thursday): World Energy Congress, Riyadh.

26-28 October (Monday-Wednesday): ACHEMA Middle East, Riyadh International Convention & Exhibition Center.

NOVEMBER

24-28 November (Tuesday-Saturday): Aero Middle East and Sand & Fun, Thumamah Airport, Riyadh.

Signposted to happen sometime in 2026:

2H: Sabic’s USD 6.4 bn Fujian project in China to start production;
September: Saudi Paper and Packaging Expo, Riyadh International Convention & Exhibition Center;
November: The UN Trade and Development Global Supply Chain Forum to take place in Saudi Arabia;
November: The Esports Nations Cup, Riyadh;
The World Economic Forum’s Global Collaboration and Growth Meeting, Jeddah;
SkyMove Air Cargo MENA, Riyadh;
The Intervision international music competition will take place in Saudi Arabia.

Signposted to happen sometime in 2027:

The World Water Forum takes place in Riyadh;
The Ocean Race finishes in Amaala on the Red Sea;
Riyadh-Kudmi transmission line to be completed;
Capital Markets Forum takes place in March in Riyadh.

Signposted to happen sometime in 2Q 2027:

The Hail Region Water Networks Project is expected to be completed.

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