Riyadh Air faces operational shifts as an alternate airport serves as a hub after strikes damaged facilities. The marquee Saudi investment conference has been postponed. Saudi Aramco headquarters and a critical pipeline were struck.
Ships in the Strait of Hormuz remain at risk of missile and drone attacks. The energy conference ADIPEC begins in Abu Dhabi, though Exxon Mobil CEO Darren Woods withdrew due to security concerns. The International Monetary Fund predicts Gulf Cooperation Council economic growth will tumble by 5 percent this year.
Kuwait, Bahrain, and Qatar face double-digit contractions due to dependence on the besieged strait. Saudi Arabia's economy shrank 3.8 percent in the last quarter, driven by a 20.4 percent plunge in oil activity. Pipelines bypassing the strait and U.S. military operations have helped maintain oil flow.
Dubai International Airport traffic remains below last year's levels. Beyond hydrocarbons, tourism, hospitality, and real estate suffer from a confidence shock. Moody's vice president Aurelian Mali warns that protracted uncertainty could damage non-oil economic models built on stability.
Oman is the one economy expected to grow, with forecasted growth jumping to over 4 percent. The UAE government, holding nearly $3 trillion in sovereign assets, vows to bring dependence on the Strait of Hormuz to "zero". The war imperils the region's artificial economy building plans amid prolonged uncertainty.
Source: New York Times Business · Summarized by HeadlinesBriefing