Stress Tested, Not Broken: what Geopolitics has changed for GCC Business

Executive Summary

Seven months after the war began, the GCC has proved more exposed than most had assumed, and more resilient than its critics expected. Ship transits through the Strait of Hormuz fell 95% in March and were still 93% below pre-war levels in August, yet GCC bond spreads returned to pre-war levels after an initial 50-bps spike, and USD 7 trillion of sovereign wealth and reserves gives the region room to finance its deficits. Geography decided the damage: Oman’s outgoing shipments rose 18% while Saudi Arabia’s fell 89%, and Kuwait exported no crude in April for the first time since 1991. Nor has a high oil price meant high oil revenue. Brent averaged 45% more in Q2 2026 than a year earlier, yet Saudi Arabia’s deficit was unchanged and Qatar’s widened from QAR 0.8 billion to QAR 21.2 billion as LNG exports were curtailed. For businesses, geopolitics now shows up on almost every line of the income statement, from interest costs to insurance, inventory and valuations. Export access, rather than the oil price, has determined fiscal outcomes in this war, and volatility is now the operating environment.