Three more years of this?

1

OPENING NOTE

Trump will address the world tonight on Iran war. What he’s gonna say is anyone’s bet.

Good morning, friends. We’ve held for a while now that an Israeli disinformation op is angling to draw the Gulf countries into the war against Iran.

That’s well out in the open this morning, with the Wall Street Journal citing unnamed “Arab officials” as saying the UAE is not just pushing for a UN resolution to demand the reopening of Hormuz — it’s also champing at the bit to join the fight.

A UN resolution makes sense, but we’re less certain about the military commitment. This much is clear: More than a month in, we can all see the regional economy sliding off the table. The problem is that there are only two people who can do anything to stop it — one sits in DC, the other in Israel.

It feels like one of those ‘inflection point’ days, but with the Trump administration? It’s anybody’s guess. The US press is speculating this morning that The Donald could declare the war is ending after he told reporters overnight, “We will be leaving very soon.” He’s due to make a televised address about the war at 9pm Eastern time tonight. (And to think we have nearly three more years of this…)

All the more reason for banks and businesses across the region to shore up their balance sheets, following the lead of UAE lenders in recent days. –Patrick

Hormuz isn’t the Red Sea — and that’s the problem

As the UAE joins Western nations in pushing to reopen the Strait of Hormuz, it’s time to ask whether the naval playbook could even work. The Wall Street Journal reports that Abu Dhabi is pushing for a UN Security Council resolution authorizing the use of force, reviewing how its own military could participate — including mine clearance and support operations — and has urged Washington to seize Iranian-held islands in the strait, including Abu Musa. Bahrain is sponsoring the resolution, with a vote possible as early as tomorrow, the paper says.

The UAE is extra edgy after an Iranian drone struck a fully loaded Kuwaiti oil tanker while anchored at Dubai Port, resulting in a fire aboard the vessel. The strike may have triggered an oil spill in the area, the Kuwait Petroleum Corporation said. No injuries were reported, and Dubai authorities have managed to extinguish the resulting fire.

The problem is that Western nations aretrying to reopen Hormuz with a playbook that already failed once, when they tried to re-open the Red Sea route to the Suez Canal in the face of the Houthi attacks on shipping that began in fall 2023.

The Red Sea campaign burned through USD 1 bn in defense spending, saw the loss of ships, and still carrier operators abandoned the route rather than use it. And Hormuz is harder by every measure: The danger zone is up to five times larger than Bab Al-Mandab and Iran operates as a full military force with missiles, drones, mines, mini-submarines, and swarm boats in the same battlespace. Analystsexpect months of sustained operations just to stabilize flows.

Trump looks set to declare ‘victory’ and walk away: “We will be leaving very soon,” he told reporters in the Oval Office overnight. The White House said a couple of hours ago that Trump will deliver a televised address at 9pm Eastern time on Wednesday, and he’s already told he’s willing to end the war without reopening the strait, leaving it to others.

Washington is calling onChina — the largest buyer of Gulf crude — to help, while Nato and European allies have declined to commit forces. Russia and China could veto the UNSC resolution, and France is proposing a different version.

No reroute, no half-measures

There’s no “steam around the cape” alternative to the Strait of Hormuz, which carries roughly a fifth of global oil and LNG, alongside critical commodities from food to metals — volumes that can’t be rerouted at scale.Iran is looking to turn the strait into its version of the Suez Canal — complete with a toll system — and Gulf states fear any diplomatic resolution would hand Tehran a formal say over the waterway.

The risk is that fighting makes things worse before it makes them better. Any military operation would need to control not just the waterway but its 100-mile length, potentially with ground troops. And the UAE could end up absorbing escalating Iranian strikes, eroding investor confidence, and struggling to rebuild ties with a neighbor that outlasts the war.

Nor any drop to drink

Iran and the United States are playing a game of tit-for-tat over what’s a fair military target, and there’s new risk that desalination infrastructure could be on the list. In the past few days, we’ve seen the target list grow to include:

Industry: US-Israeli airstrikes reportedly hit Iran’s Tabriz Petrochemical Company on Monday. That’s after a weekend that saw Emirates Global Aluminum and others in the region take Iranian hits in response to US strikes on steel producers.
Academic institutions: US-Israeli airstrikes hit the Isfahan University of Technology on Sunday for the second time since the war erupted.
Media: Qatar’s Al-Araby TV office in Tehran was struck on Sunday while the bureau chief was live on air.

Trump is now threatening to hit Iranian energy infrastructure if the two sides do not “shortly” reach a deal to reopen Hormuz. The threat came shortly after reports claimed Iran targeted a power and water desalination plant in Kuwait on Sunday, killing at least one worker. Iran denied responsibility later, accusing Israel of carrying out the strike.

Why it matters: Gulf states rely on desalination for over 90% of their drinking water — and Kuwait gets some 42% of its total annual water supply from it. This dependency varies across the Gulf, with Qatar being the most dependent (77% of its total supply) and Saudi Arabia the least exposed (17%).

Attacks on water infrastructure would be an existential threat to GCC nations, not an economic one, and risk drawing them more directly into the conflict.

Supply chain blues

Sadara Chemical Company — the USD 20 bn JV between Saudi Aramco and Dow — pulled the plug on production at its Jubail complex, with no clear timeline yet for when operations could resume, the firm said yesterday in a stock exchange filing.

War-inflicted supply chain snags are to blame, and bringing the plant back online is entirely contingent on “domestic and international factors,” the management said.

Why it matters: The shutdown is a big deal for the petrochemical industry far beyond the Gulf. Sadara’s Jubail facility turns out c. 3 mn tons of plastics and chemicals every year, feeding everything from auto manufacturing to the global packaging industry. 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 for the petrochemicals industry doesn’t look good., according to BloombergNEF estimates.

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.

Private credit goes retail in Saudi

Private credit is going retail in Saudi: So-called “financing investment funds” — vehicles that extend direct and indirect credit to businesses — will be able to list on Tadawul’s main and parallel markets under proposed rules now up for public consultation, the Capital Market Authority (CMA) said in a statement . The move would open to retail investors an asset class once reserved for deep institutional pockets via private placements, possibly providing a new source of long-term capital for credit-hungry mid-market firms.

Why now? Banks have limited resources, and they’re all-in on gigaprojects. Borrowing appetite at everything from Neom to Diriyah is eating up the two key resources of any bank: Liquidity and the time of their bankers. It’s not that banks are more selective, it’s that they don’t have bandwidth. In many respects, it costs a bank as much to write a small-ticket loan for a mid-sized family business as it does to kick the tires on a much larger (and thus more lucrative) facility for a state-backed giant.

“There’s a clear pipeline of companies that are growing but still under-served by traditional financing,” senior investment banker Mustafa Fahim tells EnterpriseAM. Investment funds going public could help bridge that gap “by bringing more market-based credit into the system,” he added.

The missing middle will capture the flow: “The real [potential] is in mid-sized companies — industrials, healthcare, education, and some tech-enabled businesses,” Fahim told us. Private investment funds look at “companies that are scaling well, but don’t always have efficient access to flexible credit. That missing middle is where these funds can play a meaningful role,” Fahim adds.

Guardrails around risk are conservative but understandable, Fahim told us. On the main market, borrowing is capped at 15% of net asset value, while funds listed on Nomu are allowed to run with higher leverage of up to 50% of fund size, the CMA statement read. Exposure limits are also tightened, with indirect financing funds restricted from allocating 25% or more to a single borrower or group.

Uh, Enterprise? Why do Nomu-listed funds get more room on leverage? It comes down to the investor base, Fahim explained. Participation in the parallel market is limited to qualified and institutional investors who meet professional, income, or net worth thresholds. They’re investors who are (theoretically) better-equipped to assess risk, allowing regulators to tolerate higher leverage.

Tighter restrictions on Tadawul’s main market are designed to protect a wider investor base. While similar vehicles in more mature markets like the US typically run higher leverage to juice returns, the Saudi cap is a tactical choice to keep risk in check. “This is a new product for the market, so the focus is clearly on stability and building investor confidence first,” he said.

How fund managers will likely hunt for alpha: With leverage restricted, fund managers will have to work harder for their returns. “Managers can still generate returns by targeting higher-yield segments and leaning on structuring,” Fahim said. In practice, this means moving up the risk curve into instruments like high-yield sukuk, mezzanine debt, and subordinated structures to drive returns on a risk-adjusted basis.

Regulators move to shore up bank liquidity as conflict enters second month

Central banks across MENA are handing down rules they hope will protect bank balance sheets and keep credit flowing as the war in the Gulf passes the one-month mark. Fitch Ratings previously estimated GCC banks’ existing buffers could contain credit risks for one month, while Bloomberg Intelligence estimated a more generous two-month window. Central banks are cautious things by nature — they’re now girding for a longer war (or at least for more persistent fallout).

The policy response across the region has been largely coordinated in spirit, even if not in form. The central banks of the UAE, Qatar, and Kuwait all loosened liquidity rules and expanded access to central bank funding.

Kuwait cut both its liquidity coverage ratio (LCR) and net stable funding ratio (NSFR) by 20 percentage points to 80% while also cutting regulatory liquidity ratio, moves that tell banks to lend more and hedge less;
Qatar took a longer-term approach, cutting reserve requirements by one percentage point to 3.5% and replacing overnight repos with three-month term facilities to give banks a sustained liquidity runway;
The UAE earlier gave banks permission to draw down cash reserves and introduced “loan-classification flexibility” that allows lenders to delay recognizing conflict-disrupted debt as non-performing.

SOUND SMART- The LCR is a Basel III liquidity threshold that sets minimum requirements for high-quality assets a bank needs to hold to weather 30 days of financial stress on its own. The NSFR, meanwhile, governs whether a bank’s longer-term lending is matched by equally durable funding sources. By focusing on these two ratios, Kuwait signaled its focus is less on the next 30 days and more on the next 12 months.

REMEMBER- Shareholders could face a 50% cut to their 2026 dividends as executives move to preserve an estimated USD 10 bn in capital, as we reported earlier this week.

Why it matters: While GCC banks entered the conflict with solid buffers, a prolonged standoff changes the calculus. Fitch warned last month that a conflict lasting beyond one month could have “serious effects” on financial metrics. As debt capital markets become more restrictive — with average liquidity scores for GCC USD sukuk already slipping — banks are being forced into more expensive domestic funding. That shift will show up in one of two ways this quarter: Compressed net interest margins or a sharp slowdown in loan growth. While neither would be catastrophic on its own, a simultaneous squeeze on both would be problematic for a region where credit expansion has been a primary growth engine.

The region’s credit cracks are widening

Many of the region’s USD-denominated sukuk and bond yields blew out to five-year-high spreads since the outbreak of the Iran war, but remain below pandemic levels, according to a Fitch Ratings note. Total GCC bond spreads widened by 42 bps on a YTD basis, with corporate spreads (+67 bps) bearing the brunt of the increase, Emirates NBD said in a separate note (pdf).

Pricing pressure froze the primary market, pushing activity towards alternative funding channels: With GCC bonds shedding 2.4% YTD (compared to a 1.6% dip in the broader EM complex), issuance slowed to just USD 1.7 bn in March, down more than two-thirds y-o-y and sharply below the USD 10 bn raised in February. Borrowers are now moving more towards bank-led lifelines such as syndicated loans and CDs, with GCC syndicated loans rising 12% y-o-y to USD 450.5 bn.

REFRESHER- The pressure first started to show among Dubai property players when six USD bonds issued by Binghatti and Omniyat tipped into distressed territory last week. Spreads on Sobha and Arada paper also blew out sharply, suggesting that Dubai’s more cyclical credit story remains the market’s clearest pressure point.

There’s still a buffer — and some who are swimming against the tide: The region’s sukuk continues to trade tighter than conventional bonds, reflecting steady support from Islamic-bank liquidity, Fitch says. Sukuk mostly steadied last week and sovereign bonds also remained largely steady, even as broader regional markets came under pressure. Meanwhile, Emirates NBD just raised USD 2.25 bn through a syndicated loan and Murabaha facility, securing commitments from 15 banks with its tightest pricing on record for one of the GCC’s largest syndicated borrowings to date, it said in a press release.

Dubai Investments appoints permanent finance chief

Nishant Shah (LinkedIn) is now CFO at Dubai Investments, where he’s been serving in an acting capacity since last July, according to a disclosure (pdf). Shah has been with the Investment Corporate of Dubai-backed firm since 2019. He was previously a director at KPMG Lower Gulf, advising listed firms, multinationals, and large family businesses.

Of acquisitions and fundraising

Dubai-based global ports operator DP World is acquiring a 49% stake in a new logistics joint venture with Russia’s state nuclear firm Rosatom, which will hold 51%, Reuters reports. Rosatom will fold its 92.4% stake in transport group Fesco, while DP World will bring liquidity tied to Fesco’s valuation. The partnership opens a channel into Russian-linked container flows and North Sea routes, a lane Rosatom is trying to scale into a commercial corridor.

DP World and Rosatom have been building toward this since 2021, signing Arctic route agreements and setting up a similar 51/49 joint venture — International Container Logistics — back in 2023.

Banks in the UAE are shoring up their balance sheets: Emirates NBD just pulled off the largest syndicated borrowing in the GCC this year — USD 2.25 bn in long-term financing split between a USD 1.75 bn five-year sustainability-linked term loan and a USD 500 mn five-year club commodity murabaha arranged through Emirates Islamic. War or not: The S-linked loan landed the tightest pricing in ENBD’s history for a syndicated facility, per the bank’s statement. Fifteen lenders from the Americas, Europe, and Asia participated.

MEANWILE- Sharjah Islamic Bank is tapping shareholders for AED 2.59 bn through a discounted rights issue that will boost its issued share capital by a third to over AED 4.3 bn. The rights are priced at AED 2.40 — a 37% discount to SIB’s mid-February value — with Emirates NBD Capital leading.

IHC has cleared the last regulatory hurdles for its USD 1 bn takeover of India’s Sammaan Capital. The Abu Dhabi investment giant — acting through subsidiary Avenir Investment — has acquired c. 26.9% of the Mumbai-listed mortgage lender so far, with the balance to come via share warrants. Once complete, IHC will hold a 41.5% stake, giving it board control of one of India’s largest non-banking financial companies. Sammaan — formerly Indiabulls Housing Finance — operates 220 branches across 150+ towns and cities.

Why it matters: The deal, first announced last October, is part of IHC’s plan to deploy up to USD 110 bn into India over the coming decade.

Gulf sovereign money helped power Whoop’s USD 575 mn Series G, which values the IPO-bound Boston-based wearable company at USD 10.1 bn — nearly triple its last reported valuation. Collaborative Fund led the round, with 2PointZero, Mubadala, and the Qatar Investment Authority also writing tickets. Athletes including Cristiano Ronaldo and LeBron James also came in. Whoop exited 2025 cash-flow positive on a USD 1.1 bn bookings run rate, with subscriptions up 103% year-on-year, per Bloomberg. CEO Will Ahmed told Yahoo Finance this is expected to be the last private round — making an IPO the next logical step.

ALSO WORTH KNOWING TODAY

ePointZero, a subsidiary of Abu Dhabi’s 2PointZero Group, has agreed to acquire 100% of US-based Traverse Midstream Partners for USD 2.25 bn — gaining minority stakes in the Rover Pipeline and the Ohio River System, two critical pieces of North American natural gas infrastructure.

CCC Egypt is acquiring 99% of AluNile, a leading facade and glass manufacturer that generated EGP 1.5 bn in revenue in 2025 and holds an EGP 3 bn backlog — a vertical integration play to secure supply chain for large-scale building envelope projects as CCC eyes Gulf and Africa expansion.

VCs are still writing tickets to startups, drones and missiles or not: Growth investor Emirates Growth Fund is putting AED 45 mn into CarniStore — a UAE-based premium protein business that spans sourcing, production, and digital retail. And US-based Carbide Ventures led a USD 5.5 mn bridge round for Dubai-based credit scoring platform Zypl.ai. Meanwhile, MovitOn (think of it as “Uber for small parcels”) raised USD 2 mn in what it’s positioning as a “community pre-sale round”

Cairo-born Ades Holding has signed multi-year contracts to deploy three premium jackup rigs in Nigeria for the West African Exploration & Production Company under a SAR 2.73 bn (USD 729 mn) agreement — a geographic hedge at a moment when Hormuz disruptions have idled several of its GCC rigs.

Abdel Hadi Abdullah Al Qahtani & Sons and the US-based Patel Family Office are launching Ayara, a USD 1 bn platform to build and operate 50 hotels across Saudi Arabia by 2029, targeting the corporate and business-travel segment where supply hasn’t kept pace with the Kingdom’s luxury build-out.

Egypt’s Halan raised EGP 2.2 bn via a securitized bond issuance, part of a broader EGP 11.5 bn securitization program, per a statement (pdf) from counsel Matouk Bassiouny & Hennawy.

Egypt has secured a JPY 35 bn (c. USD 220 mn) concessional loan from Japan at 1.5% with a 20-year repayment schedule and a 10-year grace period.

Petrolube — the industrial oils manufacturing arm of Saudi Arabia’s Petromin — has received CMA approval for a 30% IPO on the Saudi Exchange, offering 9 mn shares.

Market Snapshot

Tadawul +0.7% • ADX -0.1% • DFM -0.2% • EGX30 +0.3%

Brent USD 103.97 / bbl • Gold USD 4,719 / oz • USD / SAR 3.75 • USD / EGP 54.54

Damietta to forward EU cargo to the Gulf + Big Oil commits to Egypt

A new lifeline to Europe for the Gulf

Damietta to forward EU cargo to the Gulf: Damietta Port launched a new service to handle refrigerated and dry cargo arriving from Europe on the Trieste-Damietta Ro-Ro line before forwarding shipments to Gulf markets through Safaga, according to a document seen by EnterpriseAM.

What changed? The service comes after transit cargo bound for Gulf countries was exempted from prior advance cargo information (ACI) registration, easing procedures at a time when regional shipping disruption is pushing cargo owners to look for faster and more predictable routing options. Damietta has already received the first indirect transit units on the Gallipoli Seaways.

Why it matters: It’s another lifeline linking the Gulf to Egypt and Europe while the Strait of Hormuz remains shut.

ALSO- Shipping giant Maersk added three new shipping services to Jeddah Islamic Port and King Abdullah Port linking them to key regional and international hubs — India’s Nhava Sheva and Mundra, and Oman’s Salalah — supporting a total capacity of 14.4k TEUs.

Big Oil commits to Egypt

Italy’s Eni is planning to invest USD 2 bn in Egypt this year to expand exploration and ramp up production from existing gas fields, CEO Guido Brusco told Prime Minister Mostafa Madbouly on the sidelines of the Egypt Energy Show, according to a cabinet statement. Eni is struggling to wring production out of its massive Zohr natural gas field.

AND- Dubai-based Dragon Oil plans to invest at least USD 3 bn in Egypt over the next few years to expand its exploration and production activity in the North African country, the company’s CEO Abdulkarim Al Maazmi told CNBC Arabia. The company will focus on developing current fields in Egypt while looking into acquiring some existing assets, he added.

Emirates snubs aviation’s rising war-risk ins.

Watch this space

#1- Emirates’ biggest edge over its non-Gulf peers may be the price of staying insured. Dubai’s flag carrier has secured war-risk cover for about USD 100k a week for its entire fleet flying to and from Dubai. Airlines based in the Gulf are generally getting more flexible rates than foreign rivals with aircraft based elsewhere, aided by operating hundreds of daily flights through regional airspace and by closer coordination with airports and local authorities. Non-Gulf airlines, meanwhile, have been quoted USD 70k-150k per flight into the region.

Non-Gulf carriers are being priced on a flight-by-flight basis, with each rotation into the region carrying its own war-risk premium. Emirates operates under a large, fleet-wide ins. structure, allowing insurers to assess risks across its network rather than on a per-flight basis — giving it a more stable and significantly lower cost base.

#2- Fitch Ratings signaled it may downgrade Qatar after placing the country’s AA rating on “rating watch negative,” pointing to mounting risks amid the Iran war.

The assessment: A more fragile security backdrop and reduced LNG returns could push Doha to step up defence and infrastructure protection spending. The country is already highly dependent on Hormuz than many of its GCC peers, making it more exposed to higher transport and insurance costs, delays, and supply chain disruptions — all of which could chip away at fiscal and external surpluses.

Qatar does have room to manoeuver — government debt is relatively contained at around 40–45% of GDP and sovereign wealth buffers remain sizable, but the cushion isn’t infinite.

#3- Tanger Med, the Moroccan industrial port complex, is positioning itself to capture business as the war in the Gulf grinds on. The port is preparing for higher vessel traffic as carriers reroute around the Cape of Good Hope — with Maersk, Hapag-Lloyd, and CMA CGM already shifting routes.

Tanger Med’s management expects the real impact on cargo flows to show up only by mid-to-late April, with Cape diversions adding roughly 10-14 days to transit times into the Moroccan hub. The port handled 11.1 mn containers in 2025, up 8.4% y-o-y, reinforcing its position ahead of competing Mediterranean hubs, with route connections to roughly 180 ports globally.

Data point

Net inflows of FDI in Saudi Arabia rose 90% y-o-y in 4Q 2025 to SAR 48.4 bn, bringing the full-year total to SAR 122.4 bn. The final quarter of the year accounted for nearly 40% of total annual inflows, rising 82% from the previous quarter.

The full-year figure is a little under a third of Saudi Arabia’s target of USD 100 bn in annual FDI inflows, which it hopes to achieve by the end of the decade. The kingdom introduced a series of reforms to attract FDI over the last year, including opening property ownership to foreigners, capital market liberalization, and a privatization strategy.

CALENDAR

April 2026

10 Apr — Central Bank of UAE policy rate decision. UAE

12 Apr — Central Bank of Egypt monetary policy decision. Egypt

13 Apr — IMF / World Bank spring meetings begin (through 18 Apr). Washington/Virtual

14 Apr — QNB 1Q 2026 earnings guidance. Qatar

15 Apr — 2Q IPO listing window opens; DIP prospectus expected. UAE

18 Apr — Kuwait Stock Exchange sector rebalancing effective. Kuwait

20 Apr — GCC Supreme Council economic session (dates pending confirmation). Saudi Arabia

22 Apr — Saudi Aramco ex-dividend date. Saudi Arabia

30 Apr — OPEC+ ministerial meeting, June production decisions. Vienna/Virtual

May 2026

3 May — SAMA 1Q 2026 inflation report. Saudi Arabia

5 May — Central Bank of Egypt 1Q 2026 monetary policy outlook. Egypt

8 May — Qatar Central Bank 1Q 2026 financial stability review. Qatar

10 May — Tadawul 1Q 2026 market review and foreign investor activity report. Saudi Arabia

12 May — Emirates Global Aluminium IPO window opens (pending). UAE

15 May — Emirates NBD 1Q 2026 earnings. UAE

18 May — First Abu Dhabi Bank 1Q 2026 results. UAE

20–22 May — Arab League economic cooperation session, Cairo. Egypt

22 May — Central Bank of UAE policy rate decision. UAE

25 May — ADNOC Drilling 1Q 2026 results. UAE

28 May — QNB 1Q 2026 results. Qatar

29 May — Saudi Telecom Company 1Q 2026 earnings. Saudi Arabia

31 May — Regional central banks publish Ramadan financial impact assessments. Region-wide

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