Rene M. Kern, a Wharton professor and chief economic adviser at Allianz, warns that the Iran‑Israel conflict could reshape Gulf capital flows. While markets fixate on when oil output normalises, investors must also gauge how the six Gulf Cooperation Council states will adjust their financing of global assets in the near term.

Over the past four years the GCC nations have posted a combined current‑account surplus exceeding $800bn, channeling patient capital into public equities, private markets and frontier sectors such as AI and life sciences. Their sovereign wealth funds, family offices and pension schemes have become fixtures in London, New York and Singapore, shaping liquidity worldwide.

The sudden halt in energy shipments forces Gulf governments to boost domestic spending, from subsidies to social safety nets, outpacing any immediate cut‑backs in overseas allocations. As each state balances its fiscal buffer, the net outflow to foreign markets may shrink, nudging