Saudi Arabia, the United Arab Emirates, Kuwait and Qatar are discussing whether to scale back certain contracts and investment commitments with the United States as regional economic pressures grow amid the ongoing conflict linked to the Iran war, according to a report by the Financial Times.
The discussions reportedly reflect concerns among Gulf governments about rising fiscal strain caused by the conflict and wider economic disruptions in the region. Officials are said to be reviewing their financial exposure and evaluating whether existing agreements or future investments with US partners should be reconsidered.
A Gulf official told the Financial Times that several countries have begun internal assessments to determine whether force majeure clauses could be applied to current contracts. The review also includes examining future investment pledges and overseas commitments as governments assess the potential economic impact if the conflict continues.
The official said three of the four major Gulf economies — Saudi Arabia, the UAE, Kuwait and Qatar — had jointly discussed the economic pressures affecting their budgets, although the official did not identify the specific countries involved in the discussions.
Economic pressures and investment review
According to the report, Gulf states are facing multiple financial pressures linked to the conflict. These include reduced energy revenues due to slower production or shipping disruptions, declining income from tourism and aviation, and increased defense spending.
Officials said the review is being considered as a precautionary measure aimed at reducing potential financial strain if regional instability persists.
The discussions could potentially affect a range of financial commitments, including investment pledges to foreign governments or companies, corporate contracts, sports sponsorships, and sales of overseas assets.
Business leaders raise concerns
Some regional business figures have also publicly expressed concerns about the economic and political implications of the conflict.
Emirati businessman Khalaf Al-Habtoor criticized the situation in a social media post directed at former US President Donald Trump, questioning the decision-making behind the conflict and its consequences for the region.
He said Gulf countries have contributed billions of dollars toward initiatives aimed at promoting regional stability and development, including plans related to rebuilding Gaza and broader peace initiatives.
“These countries have the right to ask today: where did this money go?” he wrote, adding that Gulf states must consider whether their financial contributions are supporting peace initiatives or exposing the region to further instability.
Also Read: Explosions reported in Saudi Arabia, UAE and Bahrain as Iran launches missile retaliation
The report indicates that Gulf governments are continuing to monitor the economic impact of the conflict while reviewing their financial commitments abroad.
Today's E-Paper