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The UAE lost its crown as the Gulf’s busiest project market in 2Q 2026 as regional tensions weighed on contract activity, with new project awards falling 56.6% q-o-q to USD 20.5 bn, according to Kamco Invest’s GCC Projects Market Update (pdf). Saudi Arabia overtook the Emirates after more than doubling its project awards during the quarter.
Year-on-year, the UAE’s pullback was much milder — down just 5.4% from USD 21.6 bn in 2Q 2025.
The slowdown left the UAE with 34.4% of all GCC project awards in 2Q 2026, down from 47.3% a year earlier. Across the region, contract awards fell 25.4% q-o-q to USD 59.4 bn as the Iran war weighed on economic activity, although total awards remained 30% higher than a year earlier thanks to strong growth in Saudi Arabia and Oman.
The UAE’s decline was broad-based. Seven of the country’s eight project sectors recorded lower award values than a year earlier, led by gas, where awards collapsed to USD 30 mn from USD 5.3 bn in 2Q 2025.
Oil was the clear exception. The sector accounted for more than half of all projects awarded in the UAE during the quarter, reaching USD 11.5 bn, compared with just USD 230 mn a year earlier.
That momentum could continue. Adnoc said it plans to award USD 54.4 bn worth of contracts between 2026 and 2028 as part of its USD 150 bn, five-year capital spending program. Around 70% of that spending is earmarked for upstream oil and gas projects, with the remainder allocated to downstream developments.
While the latest quarter marked a slowdown, the longer-term pipeline remains substantial. Meed estimates there are around USD 2.1 tn worth of projects planned across the GCC, with the UAE accounting for 26.1% of the regional pipeline, second only to Saudi Arabia. Construction represents the largest share of upcoming projects, followed by transport and power.
BACKGROUND- The war’s impact on the UAE’s projects market first became clear in March when the number of contracts awarded fell to 16 from 52 in February, while the value of awards dropped 26% m-o-m to USD 9.7 bn. BMI still ranked the UAE as MENA’s most attractive infrastructure market in a report earlier this month, arguing that the country’s deep capital markets, strong foreign investor base, and sizable project pipeline continue to support its long-term appeal.
