Good morning, ladies and gents. The theme today is diversifying: away from the sea, into new markets, and, in one case, straight back through the strait everyone’s been avoiding.

Riyadh Air’s cargo arm is seeing more inquiries as shipping disruptions push some freight to air. Interest is strongest on Asia-Middle East-Europe routes, where Red Sea and Hormuz disruptions have hit sea freight hardest.

Adnoc, meanwhile, is shopping for refineries: The company is in talks for stakes in facilities run by units of Thailand’s PTT and Nigeria’s Dangote Group.

PLUS- A Qatari LNG tanker just crossed Hormuz for the first time since July. The transit follows several empty Qatari LNG tankers heading back toward the Gulf, a sign QatarEnergy may be positioning vessels for a resumption even after the recent US-Iran escalation in the region.

And overnight, the conflict picked up a second battlefield: US forces destroyed five Iranian oil carriers in retaliation for two ballistic missile strikes launched by the Islamic Revolutionary Guard Corps at a US Navy warship over the past two days, US Central Command said. This coincided with strikes by Iran-backed Houthi militants against Saudi oil facilities, marking a further escalation in the Middle East conflict.

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Hello Hormuz, my old friend

A Qatari LNG tanker crossed the Strait of Hormuz yesterday — the first to make the transit since early July, according to ship-tracking data compiled by Bloomberg. The Al Marrouna, which loaded its cargo in Qatar in early August and sat for roughly a month before making the crossing, was broadcasting its position in the Gulf of Oman on Tuesday morning, signaling Port Qasim in Pakistan as its next stop.

The transit follows several empty Qatari LNG tankers heading back toward the Gulf, a sign QatarEnergy may be positioning vessels for a resumption even after the recent US-Iran escalation in the region. Qatar had all but halted shipments since one of its tankers was attacked in early July, and extended force majeure on deliveries into November.

Why it matters: Outbound Gulf LNG flows remain below the pre-war pace, even as gas prices in Europe and Asia have surged to their highest levels in over three years and price-sensitive South Asian buyers — including Pakistan, where Al Marrouna is headed — face shortages and blackouts. A wider resumption would ease that pressure, but Iran’s agreement with Oman on managing Hormuz shipping is expected within days, and traders are weighing whether it will tighten Tehran’s grip on the waterway and how Washington might respond.

UK’s Gulf trade push picks up speed

The UK says its long-delayed GCC trade agreement could be signed within weeks. British Trade Minister Anas Sarwar told The National that London is ready to sign the Gulf agreement, adding that discussions with Abu Dhabi over what comes next are underway. His message: “We’re not going to wait. Those conversations have already begun.”

The GCC leg is nearly there: The agreement, which the two sides wrapped up in May after almost four years of negotiations, is now awaiting signature and domestic approval. The UK estimates it could lift trade with the bloc by 19.8% in the long run and eliminate USD 784 mn in annual tariffs on British exports at current trade levels — USD 486 mn from day one.

Riyadh and Abu Dhabi are getting extra attention: Sarwar chose Saudi Arabia and the UAE for his first trip outside Europe as the Iran war pushes energy and supply-chain security higher up London’s agenda. “It’s not a coincidence that we’re here in the Gulf,” he said. Talks covered investment in energy, AI data centers, ports, aviation, and defense, with Sarwar looking for capital to flow both ways — more Gulf money into the UK and more UK investment into the region.

REMEMBER- The UAE had already been angling for more. We reported last month that the UAE was pushing for a bilateral CEPA beyond the GCC agreement, with the UK government telling us it had launched a consultation on deepening ties. A separate track has plenty to work with: UK-UAE trade reached GBP 25 bn in 2025 — almost half the GBP 53 bn traded between Britain and the GCC as a whole — while the UAE-UK Sovereign Investment Partnership has delivered more than GBP 30 bn of investment commitments into Britain since 2021.

Flying in greater numbers

Air Cairo will finalize an order for 15 Airbus A320 family jets — along with options for 15 more — as soon as this week, Bloomberg reports, citing unnamed sources it says are familiar with the matter. The order’s ticket was not disclosed.

The state of the fleet: The Egyptian budget airline boasts a fleet of over 40 aircraft, including 33 Airbus A320s, six ATRs, and three Embraer jets, according to its website.). As of August 2025, its fleet size was approaching half that of national flag carrier EgyptAir. Air Cairo — which primarily flies smaller models — now runs over 500 weekly flights across 90 domestic, regional, and international destinations.

Market watch

Oil prices surged this morning as Middle East attacks stoked supply fears, Reuters reports. Brent crude futures increased 1.4% to USD 99.33 / bbl by 02.12 GMT, while West Texas Intermediate (WTI) rose 1.4% USD 94.34 / bbl.

The Baltic Index gains ground: The Baltic Exchange’s dry bulk index — which tracks rates for the capesize, panamax, and supramax vessel segments — rose 0.3% to 3,584 points on Tuesday. The capesize index increased 0.4% to 6,313 points, while the panamax eased 0.7% to 2,414 points. The smaller supramax inched up 0.7% to 1,693 points.

Data point

53.8 — that’s Saudi Arabia’s non-oil private sector PMI reading for August, up from 53.1 in July and marking a fifth straight month of expansion as well as a six-month high, according to Riyad Bank’s latest Purchasing Managers’ Index (PMI) report (pdf). Growth is still running below the survey's long-run average of 56.8, though. Supply chains kept improving, with delivery times shortening for a third month, and firms lifted input purchases at the fastest pace since February to meet rising output requirements.

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