How a regional war might impact the UAE’s economy. PLUS: Adnoc makes USD 18.7 bn play for Santos

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WHAT WE’RE TRACKING TODAY

THIS MORNING: G7 summit kicks off against the backdrop of escalating Middle East tensions

Good morning, ladies and gents. The last time we wrote to you, it was the start of what has now blown up into an exchange of attacks between Israel and Iran that has killed hundreds in Iran and damaged energy infrastructure, and raised concerns of a more serious and wider regional conflict.

After Israel initiated the attacks on Tehran on Friday, killing several military leaders and nuclear scientists, violence escalated between the two countries, sending jitters through markets and hiking oil prices. Iranian threats to close the oil supply chokepoint Strait of Hormuz — potentially leading to the cutting off about 20% of the world’s daily oil supply — has deepened oil concerns further.

The UAE condemned Israel’s military targeting of Iran “in the strongest terms,” warning of the risks of further escalation and calling for immediate de-escalation in a Foreign Affairs Ministry statement. The ministry urged all parties to exercise maximum restraint and emphasized the importance of diplomacy, respect for sovereignty, and adherence to international law. The UAE also called on the UN Security Council to take urgent action to secure a ceasefire and safeguard regional stability.

Foreign Minister Abdullah bin Zayed Al Nahyan ramped up consultations with regional and international counterparts to help defuse tensions, state news agency Wam reports. The talks focused on the potential fallout from the Israeli strike and underscored shared support for dialogue as the only viable path forward.

The Foreign Minister’s recent calls included:

Iranian Foreign Minister Abbas Araghchi (Wam);
Qatari Foreign Minister Sheikh Mohammed bin Abdulrahman Al Thani (Wam);
Omani Foreign Minister Sayyid Badr Hamad Al Busaidi;
French Foreign Minister Jean-Noël Barrot;
UK Foreign Secretary David Lammy and Prime Minister Keir Starmer ;
Russian Foreign Minister Sergey Lavrov (Wam);
As well as counterparts from Saudi Arabia, Jordan, Iraq, Greece, Morocco, Kuwait, Cyprus, and Bahrain.

The escalation in violence has disrupted regional airspace, with five UAE-based carriers — Emirates, Etihad, flydubai, Wizz Air Abu Dhabi, and Air Arabia — cancelling flights and making route adjustments. The disruptions primarily affect routes to Iraq, Iran, Jordan, and Lebanon.

The timeline: Emirates has suspended all flights to Amman and Beirut until 22 June, with services to Tehran, Baghdad, and Basra halted until 30 June, according to a travel update. Etihad Airways has also canceled its route from Abu Dhabi to Tel Aviv until 22 June, while maintaining a reduced service to Amman and Beirut. Flydubai suspended flights to multiple destinations including to Israel, Syria, and Jordan, while Air Arabia halted its services to countries including Iraq and cities in central Asia. Wizz Air also cancelled journeys to Israel and Jordan.

OIL WATCH-

Opec sees no need for panic: Opec is pushing back against growing concerns over global oil supply, dismissing the need for emergency action as geopolitical tensions rise, Reuters reports. Secretary General Haitham Al Ghais said there is currently no disruption warranting market intervention, rejecting the International Energy Agency’s (IEA) warning as “false alarms” and "market fear,” Reuters adds, citing the Secretary General.

Market volatility: The Israel-Iran escalation of hostilities sent oil prices up by as much as 13% on Friday midday before settling up 7%. The IEA had earlier said it stands ready to tap its 1.2 bn barrel emergency reserves if the Israel-Iran conflict escalates and disrupts supply — a move Al Ghais said is “unwarranted” given market conditions. Brent Crude futures are now up around 2.3%, to USD 75.93 a barrel.

The rapid price increase is partly because the spare oil production capacity held by Opec and its allies is only about equal to Iran’s total output, raising concerns about the ability to cover a significant supply disruption, the newswire reported separately, citing statements from analysts and Opec watchers.

Only Saudi Arabia and the UAE have the immediate capacity to increase oil production, collectively able to add about 3.5 mn bbl / d, which is roughly equivalent to Iran’s current production of 3.3 mn bbl / d, of which over 2 mn bbl / d are exported, according to analysts and industry sources. Saudi Arabia is the only member with tangible, readily available barrels, one source said, dismissing the rest as “paper” capacity.

Looking ahead: “[Oil’s] ultimate landing point will likely hinge on whether Iran revives the 2019 playbook and targets tankers, pipelines, and key energy facilities across the region,” Reuters added, citing a note from RBC Capital Markets’ Helima Croft.

WEATHER- Temperatures in Dubai will reach an afternoon high of 43°C today, and an overnight low of 33°C. In Abu Dhabi, the mercury will peak, reaching an afternoon high of 35°C, though it will feel like 44°C, before cooling to an overnight low of 31°C.

WATCH THIS SPACE-

#1- World Bank lifts ban on nuclear funding: The World Bank will resume funding nuclear energy projects for the first time since 1959, the Financial Times reports, citing a note by World Bank’s President Ajay Banga. The bank will work in partnership with the International Atomic Energy Agency, the UN’s nuclear watchdog, to support nuclear projects in developing countries.

Initial efforts will focus on extending the lifespan of existing nuclear reactors in countries that already operate them, alongside upgrading power grids and supporting related infrastructure, supporting a projected surge in electricity demand across the developing world, FT said. Banga said annual investment in generation, grid, and storage infrastructure must rise to USD 630 bn, from USD 280 bn currently, to meet demand.

The bank also plans to back emerging nuclear tech, particularly small modular reactors (SMRs), to make them viable for wider development. SMRs are a flexible and potentially more affordable nuclear alternative, but they remain in early stages of commercialization.

Nuclear needs a lot of backing: Private sector capital will be key, but the World Bank will need to back it with tools like guarantees and equity, the FT added. The nuclear industry also needs a domino effect, where other multilaterals, including the Asian Development Bank, follow suit with funding. Government-backed, low-cost financing is essential to getting large-scale projects off the ground, given their high cost and risk.

More US involvement? The US — the World Bank’s largest shareholder — and other Western nations have been lobbying for the ban lift as it looks to level the playing field for Western firms competing with state-backed nuclear giants from Russia and China, which are developing nuclear infrastructure in developing countries.

#2- First eVTOL test flight done in Abu Dhabi: The Abu Dhabi Investment Office — in partnership with Chinese autonomous aerial vehicle firm EHang and Multi Level Group (MLG) — conducted a test flight for its first passenger electric vertical take-off and landing (eVTOL) aircraft, according to a statement. The aircraft — dubbed EH216-S — is the first two-seat vehicle of its kind and is tailored to offer a variety of uses, including tours, short trip, and recreational mobility.

Abu Dhabi’s is prepping for the future: AD Ports Group, Falcon Aviation Services, and Archer Aviation are designing the country’s first hybrid heliport at the Abu Dhabi Cruise Terminal in Zayed Port after receiving legislatory approval back in April. Archer Aviation will bring its Midnight eVTOL aircraft to high-traffic areas in Abu Dhabi in a move funded by Abu Dhabi Aviation as well as a USD 300 mn BlackRock-managed fund-led funding round. The eVOLTs will be deployed to the Corniche, Saadiyat Island, and parts of western Abu Dhabi like Al Bateen, Al Khalidiya, and Al Maqtaa.

PSAs-

#1- Dubai will implement flexible working hours for government employees from 1 July to 12 September, as part of a Dubai Government Human Resources Department (DGHR) initiative, according to a Dubai Media Office statement. Participation will be left at the discretion of each government entity.

The new hours: Employees will be divided into two groups: one will work eight-hour days from Monday to Thursday with Fridays off, while the other will work seven-hour days Monday to Thursday, and 4.5 hours on Fridays.

IN CONTEXT- The move follows a pilot last year across 21 entities, which DGHR says improved productivity and work environments, and lifted employee satisfaction to 98%.

#2- Dubai tram back in service after Marina fire: Tram operations between Dubai Marina station and Palm Jumeirah station have resumed, Dubai’s Roads and Transport Authority said in a post on X. Service was temporarily suspended on Friday night as a safety precaution following a nearby high-rise fire.

HAPPENING THIS WEEK-

#1- President Sheikh Mohamed bin Zayed Al Nahyan is at the G7 summit in Canada till tomorrow. The summit this year is set to be dominated by the Iran-Israel conflict, while trade talks are likely to heavily feature as US President Donald Trump plans bilateral meetings. Also on the agenda: the Russia-Ukraine war, critical minerals, and AI.

#2- The US Federal Reserve’s Open Market Committee is meeting on Tuesday and Wednesday to assess interest rates and economic outlook amid global and domestic uncertainty.

The US Federal Reserve is widely expected to maintain its current policy, keeping benchmark federal fund rates at 4.25%-4.50% during this week’s meeting as persistent tariff-related inflation and global uncertainties overshadow easing pressures, according to a Reuters poll of economists. Economists estimate the first cut won’t arrive until September, with another potential cut set to follow by the year-end.

#3- The Global South Economic Forum will take place tomorrow at the Anwar Gargash Diplomatic Academy in Abu Dhabi, and will gather policymakers, experts, and technocrats. The forum will tackle the USD 4 tn gap faced by developing nations in development financing, and explore frameworks to strengthen economic ties and integration through trade blocs, according to a press release.

#4- The Middle East Event Show is happening on Tuesday and Wednesday at the Dubai World Trade Center. Industry players from the events sector will meet for seminars, discussions, and networking sessions on the latest sector-specific trends.

#5- The Abu Dhabi Infrastructure Summit will be running on Tuesday and Wednesday at the Abu Dhabi Energy Center. The event will see upwards of 70 speakers, 2k attendees, and 25 exhibitors meet to discuss urban planning, smart cities, mobility, energy, and healthcare.

THE BIG STORY ABROAD-

Once again, the international press is zeroing in our part of the world as Israel’s war with Iran enters its fourth day, with reports coming out overnight about the US vetoing Israeli plans to kill Iran’s supreme leader and continuing strikes that have now pushed the death toll to at least 244 in Iran and 10 in Israel.

US President Donald Trump allegedly vetoed Israel’s plan to kill Iranian Supreme Leader Ayatollah Ali Khamenei, which it presented to the US in recent days amid the ongoing escalations between Iran and Israel. The Trump administration reportedly rejected the plan as it saw it as “as a move that would enflame the conflict and potentially destabilize the region,” an unnamed US official said. Israeli Prime Minister Benjamin Netanyahu in response to the news seemed to refuse to put regime change off the table, telling Fox News that “we do what we need to do.” (Associated Press | Reuters | Financial Times | Guardian | New York Times)

While over in the business papers, Renault CEO Luca de Meo has stepped down to pursue a new position as CEO of French luxury group and Gucci owner Kering. Kering shareholders will be hoping that de Meo will be able to turn around the company like he did with the previously struggling French automaker, with shares in the luxury brand having lost 60% of their value in the last two years. (Financial TimesT | Reuters | Bloomberg)

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How the Israel-Iran escalation could impact the UAE’s economic prospects

The escalation of violence between Israel and Iran could have heavy implications for the UAE’s economy, National Bank of Kuwait's Issa Hijazeen told EnterpriseAM. The possibility of supply disruptions, retaliatory missile strikes, and even the closure of the Strait of Hormuz has become a credible threat, with both sides vowing continued escalation.

The strikes have already driven oil prices higher, due to expectations of risk to global energy supply chains, Hijazeen notes. Higher oil prices would increase fiscal revenues and strengthen the UAE's external position. However, a prolonged conflict that disrupts air travel or threatens strategic infrastructure could undermine non-oil growth in many sectors including tourism, logistics, and finance — all of which are essential for the UAE 2031 strategy, Hijazeen added.

While Israel’s attacks have not yet disrupted oil supplies despite attacks on energy sites, Iran closing the Strait of Hormuz — a channel for some 20% of the world’s oil supply — or attacking regional oil infrastructure could cause prices to rise by a further USD 20 per barrel, former Opec official and Rystad’s head of geopolitical analysis Jorge Leon told Reuters. Meanwhile, Wall Street analysts are warning that the commodity could top USD 90 a barrel if the Israel-Iran conflict “broadens dramatically,” with Goldman Sachs analysts estimating that the conflict could temporarily knock out 1.75 mn barrels a day of Iranian supply over six months, Yahoo Finance reports.

THREE SCENARIOS-

“The degree to which the conflict escalates will determine whether the region emerges more fiscally empowered, or whether gains in diversification, trade, and investment will be overshadowed by regional instability and investor caution,” Hijazeen said.

#1- In the optimistic scenario, the conflict between Israel and Iran remains geographically contained, with Iran avoiding attacks on GCC oil infrastructure or US bases, and the Strait of Hormuz stays open under increased monitoring. Brent crude prices would stabilize in the USD 80-85 per barrel range due to supply risk premiums rather than actual production cuts.

Higher hydrocarbon prices would widen the fiscal surplus for the UAE slightly to about 4.5% of GDP. However, growth in the UAE's non-oil sector could slightly decelerate to around 4.1% in 2025, though it would remain strong, supported by ongoing reforms and significant FDI inflows.

#2- The baseline scenario according to Hijazeen will see a prolonged war with partial supply disruptions, characterized by continued Israeli targeting of Iranian military sites and limited Iranian responses against US assets or GCC infrastructure. The Strait of Hormuz will remain open, though maritime ins. costs will go up.

Oil prices are expected to rise to USD 95-100 per barrel, with increased ins. premiums and potential small-scale physical disruptions due to the loss of some Iranian crude, partially offset by spare capacity in the UAE and Saudi Arabia.

Rising defense and strategic reserve spending will pressure the UAE’s budget towards a narrower surplus. The non-oil sector — including tourism, aviation, and regional non-trade — will experience tangible slowdowns, and FDI decisions may be delayed, negatively impacting non-oil growth across the GCC, while the financial sector will likely increase provisions to counter the potential increase in non-performing loans.

#3- Finally, a pessimistic scenario of a full-scale conflict could involve Iran attempting to block the Strait of Hormuz or targeting UAE and Saudi oil infrastructure, while regional airspace would face intermittent shutdowns. This would cause Brent oil prices to surge to USD 100-120 per barrel due to expected supply losses and heightened risks to shipping routes.

While record oil revenues would be generated, they would be offset by increased emergency spending, reconstruction efforts, and subsidy increases, potentially leading to record fiscal deficits in both the UAE and Saudi Arabia, Hijazeen argued. Non-oil sectors like tourism, aviation, logistics, and real estate would contract, capital flight would increase due to heightened risk aversion, and long-term investor confidence would decline, severely disrupting trade due to the blockage of the Strait of Hormuz or attacks on shipping.

Across all scenarios, the monetary policy of the UAE and Saudi Arabia will remain tied to the US Federal Reserve's decisions, Hijazeen concludes. Central banks will have limited independent flexibility and will likely mirror any policy changes made by the Fed, as both currencies are pegged to the USD.

At this stage, it’s difficult to know: “If there is no disruption to Gulf oil then the boost in prices will help with public finances, and hence spending plans that drive non-oil growth, as well as encourage further hikes in OPEC+ production, supporting [and] boosting non-oil growth. However, risk concerns may delay investment decisions in the region and increase ins. and other costs,” GCC Economist and Khalij Economics Director Justin Alexander told EnterpriseAM. “The market may also demand higher rates of interest on debt issued in the region. If the war escalates and includes damage/disruption to shipping or on the gulf mainland then the negative impacts will be greater,” he said.

XRG leads consortium bidding for Australian oil and gas firm Santos

Adnoc makes USD 18.7 bn play for Santos: Adnoc’s international investment arm XRG has submitted an indicative, non-binding USD 18.7 bn takeover bid alongside Abu Dhabi sovereign wealth fund ADQ and private equity firm Carley to Australian oil and gas producer Santos, Santos said in a statement. The company has already said it intends to accept the offer, provided it does not receive a superior proposal.

The acquisition would require 75% support from Santos’ investors, as well as approval from several Australian regulators, including the Foreign Investment Review Board, which one analyst told Reuters could be a risk to the agreement, since it involves critical energy infrastructure in Australia. The company is the biggest supplier of natural gas in Australia, and owns pipeline gas and oil assets as well.

The details: The consortium will pay USD 5.76 (AUD 8.89) per share as part of the transaction, marking a 28% premium to Santos’ last closing price of AUD 6.96.

Due diligence negotiations are underway: Santos intends to provide the consortium with access to due diligence, but is currently negotiating terms of a deed that would give it exclusive access, the statement said.

Santos has been subject to merger talks before, with a potential transaction merging it with Australian rival Woodside in what would have created a AUD 80 bn oil and gas giant, but Santos rejected the proposal.

XRG has its eyes on LNG: State-owned energy giant Adnoc is boosting its LNG capabilities both at home and abroad, with a plan to establish a top-five integrated global gas and LNG business, setting a target of 20-25 mn tons per annum (mtpa) in capacity by 2035, having already secured an enterprise value of over USD 80 bn in its first six months. The group is assessing upstream gas M&A and LNG moves in the US and Canada to up its regional footprint there. Back in March XRG said it would make a “very large and significant investment,” in the US and last month it was reported that XRG would soon begin deploying capital — including in the US — after fine-tuning its internal strategy. The five-year strategy also builds on recent agreements in the US, Mozambique, Egypt, and Turkmenistan. It has also been eyeing a potential acquisition of some of British Petroleum’s (BP) assets, with an interest specifically in its LNG assets.

ADVISORS- Goldman Sachs and JB North & Co are financial advisers to Santos, while Rothschild & Co is acting as independent board adviser. Herbert Smith Freehills Kramer is acting as legal adviser to Santos.

GDP grows 4% y-o-y in 2024

The UAE’s GDP reached just under AED 1.7 tn in 2024, growing by 4% y-o-y, state news agency Wam reported. Non-oil GDP grew by 5% — totalling AED 1.3 tn, and accounting for 75.5% of the country’s gross domestic product — while oil-related activities made up the remaining AED 434 bn to the overall economy.

Driving the growth: The transport and storage sector was the fastest-growing contributor to GDP in 2024, recording 9.6% y-o-y growth. This was mainly driven by the performance of UAE airports, which saw the number of passengers increasing by 10% to 147.8 mn. This was followed by the building and construction sector, which grew at 8.4% due to “substantial investments in urban infrastructure.”

Financial and ins. activities also expanded by 7%, while the hotels and restaurants basket grew by 5.7%. Finally, the real estate sector grew by 4.8% during the year.

As for non-oil activity, the UAE’s trade sector contributed the most to the GDP with 16.8%, while the manufacturing sector came in second with 13.5%. The financial and ins. activities made up 13.2%, construction and building accounted for 11.7%, while real estate activities contributed 7.8% of the non-oil GDP.

This came in line with the Central Bank of the UAE (CBUAE)’s forecast, as well as that of Capital Intelligence Ratings. Meanwhile, the International Monetary Fund (IMF) projected growth of 3.7%, while the World Bank expected the UAE’s growth to come in at 3.3% in 2024.

G42 sets up Europe, UK unit to localize AI for sovereign clients

State AI firm G42 has launched a new subsidiary headquartered in London, the company said in a statement. The new entity, G42 Europe & UK, will localize the group’s AI solutions for private and public sector clients across the UK and continental Europe, as G42 expands its AI infrastructure footprint across the region.

What they’re planning: The subsidiary will deliver end-to-end AI services — spanning strategic advisory, model development, infrastructure deployment, and managed services — with a focus on healthcare, financial services, energy, and manufacturing. It will partner with local governments and industry to advance regional data sovereignty and infrastructure development.

Leadership: G42 General Counsel Marty Edelman (LinkedIn) and World Wide Technology board member Omar Mir (LinkedIn) will serve as co-chairs of the new unit.

The launch builds on G42’s growing presence in Europe: In May, G42 and Italy’s iGenius announced a planned USD 1 bn investment to develop Europe’s largest AI compute deployment in Italy’s Puglia region. That same month, G42-backed MGX and Nvidia joined a French consortium, including Bpifrance and Mistral AI, to build a 1.4 GW AI campus outside Paris. Backed by EUR 8.5 bn in planned investments, that project is slated to break ground in 2H 2026.

REMEMBER- This comes amid a wider UAE push to grow its AI presence across Europe. In February, the UAE pledged USD 40 bn in investments across Italian sectors including AI and digital infrastructure. A separate bilateral agreement with France, also announced in February, saw the UAE commit USD 30-50 bn toward French AI and data infrastructure.

The story got ink from Bloomberg.

AD Ports inks three agreements with Asry for marine services in Bahrain

Asry taps AD Ports for Bahrain maritime services: AD Ports Group has inked three heads of terms (HoTs) with Bahrain-based Arab Shipbuilding and Repair Yard Company (ASRY) to provide marine services in Bahrain across maritime and port projects, according to a statement.

#1- A shipyard-focused JV is on the cards: The pair inked a HoT to establish a joint venture (JV) to manage drydock facilities and shipyards. Under the agreement, the two parities look to boost the GCC’s drydock and shipbuilding capacity as well as explore potential options to expand their mutual businesses to other regions.

#2- AD Ports, ASRY, JM Baxi eye green ship recycling: AD Ports and ASRY signed a HoT with India-based maritime service provider JM Baxi to develop green ship recycling facilities.

#3- Potential investments across ports, terminals: The two parties inked a final HoT to develop a working group in a bid to highlight potential areas of collaborative investments across ports and terminals.

REFRESHER- AD Port’s subsidiary Noatum Maritime and Asry formed a JV — dubbed ASRY Marine — to offer integrated maritime services in Bahrain. The JV — first announced in February and activated in April — aims to deliver integrated marine services in Bahrain and marked its operational start with the arrival of four modern tugboats from Noatum Maritime’s fleet at ASRY’s headquarters.

Emirates Properties Group launches AED 350 mn Dubai project + Emaar Misr plans another Egypt project

REAL ESTATE-

#1- Emirates Properties Group AED 350 mn branded residences in Dubai: Real estate developer Emirates Properties Group has launched Azha Millennium Residences, with 196 residential units and an AED 350 mn investment ticket, according to a press release. The development in Jumeirah Village Triangle in Dubai will include residential units and retail spaces, and is slated for completion in 4Q 2027.

#2- Emaar is setting up a project on Egypt’s Red Sea: Emaar Properties’ Egyptian arm, Emaar Misr Properties, is developing a 10 mn sqm integrated tourism project on Egypt’s Red Sea in collaboration with Saudi-owned real estate developer City Stars Properties, three sources told Asharq Business. Emaar will develop the project in exchange for a percentage of the revenues. City Stars owns the land plot.

The details: The project will be rolled out in six phases, with the first covering 2 mn sqm and including residential units, four- and five-stars hotels, a commercial complex, and entertainment facilities. The project is expected to generate over EGP 500 bn in revenues once it is completed.

ICYMI- Emaar has been keeping busy, having inked an agreement earlier this year with Midar Investment to establish the AED 7.3 bn (c. EGP 100 bn) New Mivida residential project in New Cairo in Egypt. Emaar has already invested an initial USD 80 mn in the project, and plans to invest some USD 1 bn in Egypt this year.

RETAIL-

Newly-consolidated Adcoop launched in Al Ain: Mair Group’s Abu Dhabi Cooperative Society (Adcoop) has launched in Abu Dhabi’s Al Ain, according to a press release. The expansion will see 34 Al Ain Coop and Earth stores rebranded under the Adcoop entity, bringing the retail group’s total footprint to over 100 shops in the emirate. AED 5 mn is earmarked for store upgrades and hiring going forward.

ICYMI- Adcoop was rebranded last November, with Mair Group consolidating seven retail brands — Abu Dhabi Coop, Al Ain Coop, Al Dhafra Coop, Delma Coop, and Mega Mart — into a single entity.

DEBT-

AgilityGlobal’s Dubai-based energy logistics subsidiary Tristar has secured a USD 255 mn credit facility from a syndicate of regional and international banks, the company said in a disclosure (pdf). The 18-month facility, which includes an extension option and is expected to be upsized by another USD 60 mn within three months, will go towards refinancing and general corporate spending.

TRANSPORT-

Dubai’s Roads and Transport Authority (RTA) signed an MoU with Uber and Chinese autonomous driving firm WeRide to kick off operational trials of self-driving vehicles this year, according to an RTA statement. The pilot will begin through the Uber app and with safety operators in the cars, ahead of a fully driverless commercial rollout by 2026.

We knew this was coming: In April the RTA signed agreements with Uber and WeRide to test autonomous taxis, whilst earlier in February, it announced its plans to roll out its first autonomous taxi service in Dubai by 1Q 2026, adding it was considering partnerships with multiple car manufacturers to optimize safety and profitability. Abu Dhabi is set to see WeRide’s vehicles become available through the Uber app soon.

RENEWABLES-

The International Finance Corporation is offering a USD 72 mn debt facility to Amea Power to finance the integration of a battery energy storage system (BESS) into its newly launched 500 MW solar plant in Kom Ombo, according to a statement from the international lender seen by EnterpriseAM.

REMEMBER- The renewables firm has big plans in Egypt: The company plans to develop two battery energy storage systems (BESS), including a 500 MWh storage station in Benban and a 1 GWh facility in Zafarana, along with the necessary transformer stations and grid connections. It is also currently working on a USD 600 mn, 5 GW wind power project in the Gulf of Suez.

AI-

Microsoft, e& enterprise double down on AI push: Emirates Telecommunications Group’s (e&) e& enterprise is partnering with Microsoft to deploy AI and data-led solutions across the MENAT region, according to a press release. The partnership will focus on sector-specific tools for the public sector, as well as for the banking, financial services, ins., telco, and retail industries.

Who is doing what: Microsoft will provide a full stack of AI and data tools via its Azure platform to support organizations and business in operations like fraud detection, predictive analytics, and data warehousing. e& enterprise will provide its cloud migration, managed services, and hybrid cloud offering.

INS.-

IHC rolls out branding for new reins. platform RIQ: Abu Dhabi’s International Holding Company (IHC) has named its new reins. firm Reins. Intelligence Quotient (RIQ), according to a press release (pdf).

ICYMI- First unveiled last month in partnership with BlackRock and alternative asset manager Lunate, RIQ has secured over USD 1 bn in initial equity commitments, with plans to manage more than USD 10 bn in liabilities. Adnoc Group CEO Sultan Ahmed Al Jaber was tapped as chair, while former Aviva and AIA Group CEO Mark Wilson will be its CEO. The firm will use AI-solutions to offer tailored underwriting solutions in property and casualty, life, and specialty ins., and is in the final stages of securing regulatory clearance from ADGM’s Financial Services Regulatory Authority.

MENA equities dive on war fears

Markets reel as Israel-Iran conflict escalates: Stock markets across the region tumbled yesterday as the deepening conflict between Israel and Iran triggered a regional sell-off and fresh fears over energy supply, Bloomberg reports.

Egypt’s EGX 30 led the losses, falling as much as 7.7% in intraday trading on Sunday — its steepest decline in five years — before trimming losses to 4.6% at market close. The plunge came after Israel halted gas production from its largest offshore field, cutting off supplies to Egypt and stoking fears of a near-term energy crunch in the import-dependent economy. The EGP also weakened further on the parallel market, with local-bank quotes showing trades at around 50.7 per USD yesterday down from roughly 49.8 last week.

Oil cushions the blow for Aramco as TASI slides: In Saudi Arabia, the Tadawul All Share Index (TASI) plunged 3.6% at the open, with 243 of 253 stocks in the red, though losses were pared by state-owned oil giant Aramco, which gained 1.7% on the back of sharp rally in oil. TASI ended the day down 1% yesterday. Brent crude prices spiked by more than 7% to settle near USD 73 on Friday, as market prices in the risk of further disruption to Iranian exports.

UAE markets also priced in the risk on Friday: The UAE markets, which reopen today, had already closed down on Friday, with the DFM falling 1.9% and the ADX losing 1.3%, in anticipation of a wider fallout.

Also from the region: Kuwait’s main index closed down 3.9%, while the Muscat Stock Exchange lost 0.9% and Bahrain’s benchmark dropped 0.8%, respectively. In Tel Aviv, large-cap stocks opened 1.5% lower, though losses were partially offset by a rally in defense contractor Elbit Systems to close 0.5% higher.

Airlines and lenders were among the hardest hit across the Gulf, Reuters reports, with Qatar National Bank (QNB) opening down 3.3% on the Qatar Exchange yesterday, and Jazeera Airways shedding as much as 10% on the Boursa Kuwait amid widespread regional airspace avoidance. In the UAE, real estate companies were also impacted, with developers Emaar Properties and Union Properties closing down 3.5% and 6.9%, while Abu Dhabi's Aldar also dropped 3.9%.

Zooming out: The latest wave of volatility comes as MENA equities continue to underperform global peers this year, pressured by geopolitical overhang, oil-price swings, and mixed fiscal signals in large economies like Saudi Arabia.

MARKETS THIS MORNING-

Asian markets are bucking the trend today, with most of them in the green as investors await data out of China. Japan’s Nikkei is up 0.9%, while South Korea’s Kospi is up nearly 0.6%. Hong Kong’s Hang Seng futures indicate a weaker open. Over on Wall Street, futures point to a slightly stronger open after yesterday’s Iran-Israel conflict-triggered sell-off.

ADX	9,564	-1.3% (YTD: +1.5%)
DFM	5,365	-1.9% (YTD: +4.0%)
Nasdaq Dubai UAE20	4,370	-2.4% (YTD: +4.9%)
USD : AED CBUAE	Buy 3.67	Sell 3.67
EIBOR	4.2% o/n	4.3% 1 yr
TASI	10,732	-1.0% (YTD: -11.0%)
EGX30	31,016	-4.6% (YTD: +4.3%)
S&P 500	5977	-1.1% (YTD: +1.6%)
FTSE 100	8,851	-0.4% (YTD: +8.3%)
Euro Stoxx 50	5,290	-1.3% (YTD: +8.2%)
Brent crude	USD 74.23	+7.0%
Natural gas (Nymex)	USD 3.58	+2.6%
Gold	USD 3452.80	+1.5%
BTC	USD 104,792.80	-0.5% (YTD: +12.0%)
Chimera JP Morgan UAE Bond UCITS ETF	AED 3.6	-1.4% (YTD: +1%)
S&P MENA Bond & Sukuk	144.23	-0.1% (YTD: +3.1%)
VIX (Volatility Index)	15.54	+15.5% (YTD: +20.0%)

THE CLOSING BELL-

The DFM fell 1.9% on Friday on turnover of AED 1.1 bn. The index is up 4.0% YTD.

In the green: Al Mal Capital REIT (+4.5%), Gulf Navigation Holding (+4.3%) and Al Ramz Corporation Investment and Development (+4.2%).

In the red: Dubai Ins. Co (-9.8%), National General Ins. (-9.4%) and Sukoon Takaful (-7.9%).

Over on the ADX, the index fell 1.3% on turnover of AED 1.6 bn. Meanwhile, Nasdaq Dubai was down 2.4%.

Sheikh Abdullah concludes US visit to discuss cooperation

UAE and US discuss strengthening ties in Washington: Foreign Minister Sheikh Abdullah bin Zayed Al Nahyan completed a working visit to the United States, where he met several senior US officials to discuss regional stability and bilateral ties, Wam reports. The deputy PM held talks with the US’ Middle East envoy Steve Witkoff, which centered around reinforcing bilateral ties ahead of the planned economic partnership. In a separate meeting with US Commerce Secretary Howard Lutnick, the two discussed pathways to improve economic, trade, and financial cooperation. This follows Sheikh Abdullah bin Zayed Al Nahyan’s meeting with Marco Rubio last week.

The UAE has inked a governance partnership with the Dominican Republic, aiming to share expertise in capacity building, government modernization, and future skills development, Wam reports.

CALENDAR

JUNE

15-17 June (Sunday-Tuesday): G7 summit, Canada.

17 June (Tuesday): Global South Economic Forum (GSEF), Anwar Gargash Diplomatic Academy, Abu Dhabi.

17-18 June (Tuesday–Wednesday): Middle East Event Show, Dubai World Trade Center.

17-18 June (Tuesday-Wednesday): US Federal Reserve’s Federal Open Market Committee meeting.

17-18 June (Tuesday-Wednesday): Abu Dhabi Infrastructure Summit, Abu Dhabi Energy Center.

17-19 June (Tuesday-Thursday): Big 5 Construct Egypt, Egypt International Exhibition Center Cairo, Egypt.

24-25 June (Tuesday-Wednesday): EVCharge Live Middle East, Dubai World Trade Center.

24-25 June (Tuesday-Wednesday): Solar & Storage Live, Dubai World Trade Center.

24-25 June (Tuesday-Wednesday): Mobility Live Middle East, Dubai World Trade Center.

24-25 June (Tuesday-Wednesday): Middle East Rail, Dubai World Trade Center.

27 June (Friday): Islamic New Year.

Signposted to happen sometime in 2H 2025:

Closing of XRG's acquisition of Covestro

JULY

6-7 July (Sunday-Monday): BRICS Summit, Rio de Janeiro.

29-30 July (Tuesday-Wednesday): US Federal Reserve’s Federal Open Market Committee meeting.

SEPTEMBER

1-6 September (Monday-Saturday): Dubai Fashion Week, Dubai Design District.

8-10 September (Monday-Wednesday): DigiHealth exhibition, World Trade Center, Dubai.

8-19 September (Monday-Wednesday): WHX-Tech Expo, Dubai World Trade Centre.

12-14 September (Friday-Sunday): The International Real Estate and Investment Show, Abu Dhabi.

16-17 September (Tuesday-Wednesday): US Federal Reserve’s Federal Open Market Committee meeting.

24-25 September (Wednesday-Thursday): The KT UniExpo, The H Dubai.

24-25 September (Wednesday-Thursday): Mohammed Bin Rashid Leadership Forum, Mohammed Bin Rashid Center for Leadership Development, Dubai.

24-25 September (Wednesday-Thursday): Dubai World Congress for Self-Driving Transport, Dubai.

OCTOBER

1-2 October (Thursday-Friday):World Green Economy Summit (WGES), Dubai World Trade Centre.

30 September - 2 October (Tuesday-Thursday): The Water, Energy, Technology, and Environment Exhibition (WETEX), Dubai World Trade Centre.

3-16 October (Friday-Thursday): Dubai Home Festival.

7-9 October (Tuesday-Thursday): The International Symposium on the System of Radiological Protection, the Ritz-Carlton Abu Dhabi, Grand Canal.

9-15 October (Thursday-Wednesday): IUCN World Conservation Congress, Abu Dhabi.

14-16 October (Wednesday-Friday): Global Future Councils, Dubai.

22-24 October (Wednesday-Friday): World Investment Conference, Expo Centre Sharjah.

27-29 October (Monday-Wednesday): Future Hospitality Summit, Madinat Jumeirah, Dubai.

27-29 October (Monday-Wednesday): Asia Pacific Cities Summit, Dubai Exhibition Center.

28-29 October (Tuesday-Wednesday): US Federal Reserve’s Federal Open Market Committee meeting.

NOVEMBER

12-17 November (Wednesday-Monday): RoboCup Asia-Pacific, Khalifa University, Abu Dhabi.

15-17 November (Saturday-Monday): Myplant & Garden Middle East Green Expo, Dubai Exhibition Centre, Expo City.

17-21 November (Monday-Friday): Dubai Airshow 2025, Al Maktoum International Airport, Dubai.

18-19 November (Tuesday-Wednesday): Dubai Future Forum, Museum of the Future, Dubai.

DECEMBER

1-3 December (Monday-Wednesday): Eid Al Etihad (UAE National Day).

1-5 December (Monday-Friday): The World Congress of Neurosurgery, Dubai World Trade Center.

7-14 December (Sunday-Sunday): Asian Youth Para Games, APC headquarters, Dubai.

8-9 December (Monday-Tuesday): BTC Mena Conference, Adnec, Abu Dhabi.

8-10 December (Monday-Wednesday): BRIDGE media summit, Abu Dhabi.

9-10 December (Tuesday-Wednesday): US Federal Reserve’s Federal Open Market Committee meeting.

18-23 December (Thursday-Tuesday): Games of the Future, Adnec, Abu Dhabi.

Signposted to happen sometime in 2025:

The Middle East Electric Vehicle Show, Expo Center Sharjah.
e& will complete Adnoc’s private 5G network.
Executive Committee Meeting (EXCOM 2025) conference of the World Smart Sustainable Cities Organisation (WeGO)
The International Civil Aviation Organization’s Global Implementation Support Symposium, Abu Dhabi.
Universal Postal Congress 2025, Dubai.

Signposted to happen sometime in the fall of 2025:

ICOM General Conference 2025, Dubai

Signposted to happen sometime in 2026:

9-11 January (Friday-Sunday): 1 Bn Followers Summit’s fourth edition, UAE.
28-29 January (Wednesday-Thursday): IBA Arbitration Day Conference, Abu Dhabi.
3-5 February (Tuesday-Thursday): The World Governments Summit.
12-15 February (Thursday-Sunday): The Society for Incentive Travel Excellence Global Conference, Abu Dhabi.
11-13 May (Monday-Wednesday): AI Everything Global, Adnec Center.
The UAE to host the Arab Competition Forum
Dubai to host the Arab Actuarial Conference
United Nations Water Conference 2026, UAE
The first edition of Dubai Future Finance Week.

Signposted to happen sometime in October 2026:

Abu Dhabi Space Week, Abu Dhabi.

Signposted to happen sometime in 2027:

Abu Dhabi’s solar and battery energy facility, combining 5.2 GW of solar capacity and 19 GWh of battery storage, is set for commissioning.

Signposted to happen sometime between 2027 and 2029:

The commissioning of the seventh phase of Mohammed bin Rashid Al Maktoum Solar Park.

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