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Saudi Arabia Leads Contract Awards in GCC

Saudi Arabia leads the contract award in the Gulf region (Asharq Al-Awsat)
Saudi Arabia leads the contract award in the Gulf region (Asharq Al-Awsat)
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Saudi Arabia Leads Contract Awards in GCC

Saudi Arabia leads the contract award in the Gulf region (Asharq Al-Awsat)
Saudi Arabia leads the contract award in the Gulf region (Asharq Al-Awsat)

Saudi Arabia topped the GCC project awards, which improved during the year's second quarter despite global economic challenges caused by supply chain problems and higher oil prices primarily driven by the Russia-Ukraine conflict.

Higher crude oil price was the most significant contributor to inflation numbers across countries, including in the US, where it contributed around 200 bps to the 9.1 percent inflation during June-2022.

A recent report on the GCC project market update by Kuwait-based KAMCO showed that the total value of GCC contracts awarded increased by 11.7 percent year-on-year during Q2 in 2022 to reach $22.8 billion, compared to $20.4 billion in Q2 of 2021.

Saudi Arabia and Oman reported higher contract awards during the quarter that offset a dip in awards in Kuwait, Bahrain, Qatar, and the UAE.

Saudi Arabia, the GCC's largest projects market, recorded the biggest y-o-y increase in the value of contracts awarded during Q2-2022, which reached $16.5 billion in 2022 as compared to $9.3 billion in Q2-2021.

The contracts awarded as part of the $500 billion Neom project boosted the Kingdom's project awards during the quarter.

According to MEED, three out of the ten most significant contracts awarded in the Kingdom during Q2-2022 were from the Neom project. Comparatively, the UAE recorded a 46.4 percent fall in y-o-y projects awarded in Q2-2022, which reached $3.1 billion.

Saudi Arabia represented 77.2 percent of GCC contract awards in Q2-2022. Total projects awarded in Kuwait during Q2-2022 declined by 67.9 percent to $521 million, down from $1.6 billion for Q2-2021.

Total projects awarded in Kuwait reached $521 million in Q2-2022, witnessing a 67.9 percent decrease from $1.6 billion in Q2-2021.

Kuwait's transportation sector recorded the most significant increase during the quarter, with projects worth $377 million, up from $18 million in Q2-2021.

Regarding sector classification, the transportation sector witnessed the biggest increase in absolute value during the quarter, with an increase of $4.8 billion in new contracts to reach a total of $7.7 billion during Q2-2022.

Similarly, the value of new contracts in the GCC Oil Sector increased almost threefold to reach $4.5 billion during Q2-2022 rising from $1.6 billion during Q2-2021.

On the other hand, the gas, construction, and power sectors witnessed y-o-y decline in awards. Project awards in the construction sector contracted 36 percent y-o-y to $4.3 billion during the quarter.

Despite varying trends during Q2-2022, the projects pipeline in the GCC region continues to remain strong.

Data from MEED Project showed around $2.65 trillion worth of projects planned or underway in the GCC as of the end of June-2022 compared to $2.59 trillion at the end of March-2022.

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Business

JMMC Holds 65th Meeting via Videoconference, Discusses Energy Security and Market Stability

General view of Saudi Aramco's Ras Tanura oil refinery and oil terminal in Saudi Arabia May 21, 2018. REUTERS/Ahmed Jadallah
General view of Saudi Aramco's Ras Tanura oil refinery and oil terminal in Saudi Arabia May 21, 2018. REUTERS/Ahmed Jadallah
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JMMC Holds 65th Meeting via Videoconference, Discusses Energy Security and Market Stability

General view of Saudi Aramco's Ras Tanura oil refinery and oil terminal in Saudi Arabia May 21, 2018. REUTERS/Ahmed Jadallah
General view of Saudi Aramco's Ras Tanura oil refinery and oil terminal in Saudi Arabia May 21, 2018. REUTERS/Ahmed Jadallah

The Joint Ministerial Monitoring Committee (JMMC), comprising Saudi Arabia, Russia, Iraq, UAE, Kuwait, Kazakhstan, Nigeria, Algeria and Venezuela holds its 65th Meeting via videoconference.

The JMMC reviewed current market conditions and emphasized the essential role of the Declaration of Cooperation (DoC) in supporting the stability of global energy markets, according to SPA.

In this context, the committee highlighted the critical importance of safeguarding international maritime routes to ensure the uninterrupted flow of energy.

It also expressed concern regarding attacks on energy infrastructure, noting that restoring damaged energy assets to full capacity is both costly and takes a long time, thereby affecting overall supply availability.

Accordingly, the committee stressed that any actions undermining energy supply security, whether through attacks on infrastructure or disruption of international maritime routes, increase market volatility and weaken the collective efforts under the DoC to support market stability for the benefit of producers, consumers, and the global economy.

In this regard, the committee commended the DoC countries that took the initiative to ensure the continued availability of supplies, particularly through the use of alternative export routes, which have contributed to reducing market volatility.

The JMMC will continue to closely monitor market conditions and retains the authority to convene additional meetings or request an OPEC and non-OPEC Ministerial Meeting, as established at the 38th ONOMM held on December 5 2024.

The next meeting of the JMMC (66th) is scheduled for June 7, 2026.

Business

Saudi Market Edges Higher on Insurance and Basic Materials Support

An investor monitors stock prices on a screen at the Saudi stock market in Riyadh (AFP)
An investor monitors stock prices on a screen at the Saudi stock market in Riyadh (AFP)
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Saudi Market Edges Higher on Insurance and Basic Materials Support

An investor monitors stock prices on a screen at the Saudi stock market in Riyadh (AFP)
An investor monitors stock prices on a screen at the Saudi stock market in Riyadh (AFP)

Saudi Arabia’s benchmark Tadawul All Share Index (TASI) edged up 0.03 percent to 11,272 points on Sunday, supported by insurance and basic materials stocks. Total traded value reached SAR 4.27 billion ($1.1 billion).

Shares of Petro Rabigh and The National Shipping Company of Saudi Arabia (Bahri) rose 1 percent and 1.5 percent to SAR 10.9 and SAR 32.6, respectively.

Saudi Arabian Amiantit Co. (Amiantit) led gainers, rising 10 percent to SAR 15.63. In the materials sector, SABIC and Maaden advanced 0.84 percent and 0.46 percent to SAR 60.05 and SAR 65.7, respectively.

In insurance, The Company for Cooperative Insurance (Tawuniya) and Bupa Arabia climbed 1 percent and 2 percent to SAR 127.3 and SAR 174.1, respectively. Almarai rose 1.2 percent to SAR 44.48 after reporting its Q1 2029 results.

On the downside, Saudi Aramco—the index heavyweight—declined 0.22 percent to SAR 27.54.

ACWA Power fell about 1 percent to SAR 168 after announcing last week a temporary curtailment of power output at two of its solar projects. Emaar The Economic City (Emaar EC) was the biggest decliner, falling 7.6 percent to SAR 10.88.

Business

Saudi Airports Serve as Safety Valve for Regional Air Traffic as ‘Hormuz Fallout’ Hits Global Aviation

King Khalid International Airport in Riyadh (SPA)
King Khalid International Airport in Riyadh (SPA)
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Saudi Airports Serve as Safety Valve for Regional Air Traffic as ‘Hormuz Fallout’ Hits Global Aviation

King Khalid International Airport in Riyadh (SPA)
King Khalid International Airport in Riyadh (SPA)

Conflicts in the region are no longer confined to the geography of battlefields; their fallout has reached one of the world’s most vital and sensitive industries: aviation. Today, travelers and airlines alike face a harsh reality driven by record surges in jet fuel prices and a steep spike in insurance costs, pressures that have pushed ticket prices higher, threatening a severe economic squeeze that could derail global tourism plans and reshape travel patterns long taken for granted.

The surge in aviation costs cannot be separated from the turmoil in global energy markets. The link between crude oil and jet fuel prices peaked in early April 2026. As market confidence wavered amid US military threats, crude prices jumped to record levels due to the direct risk to supplies through the Strait of Hormuz, setting off an immediate spike in jet fuel prices. Given that jet fuel is among the most valuable refined products from a barrel of oil, these unprecedented crude levels pushed aviation fuel to nearly double its 2025 levels.

Compound pressures and a tourism slowdown

In remarks to Asharq Al-Awsat, aviation and airport management expert AlMotaz Al-Mirah said the current tensions, in an industry already operating on thin margins, are quickly reflected in both pricing and demand across the tourism sector.

“The rise in ticket prices today is not driven by a single factor,” he said, “but by a combination of pressures: higher fuel consumption, longer routes, elevated insurance costs, and reduced operational efficiency.”

The World Travel & Tourism Council confirmed that “the escalating conflict in Iran is already impacting travel and tourism across the Middle East by no less than $600 million per day in international visitor spending, as disruptions to air travel, traveler confidence, and regional connectivity weigh on demand.”

According to council data released in March, the Middle East plays a critical role in global travel, accounting for 5 percent of international arrivals and 14 percent of global transit traffic. Any disruption reverberates worldwide, affecting airports, airlines, hotels, car rental firms, and cruise lines.

The family travel bill

On leisure travel, Al-Mirah said fare increases have ranged from 15 percent to 70 percent across many routes- higher still on long-haul flights.

“A ticket that used to cost $500 now ranges between $800 and $1,000,” he noted, “meaning an increase of up to $2,000 for a family of four.” This is forcing many travelers to delay trips or opt for closer destinations, reshaping demand across regional markets.

He detailed the price surge since the crisis began in late February: jet fuel rose from around $85–90 per barrel to between $150 and $200. This has driven the cost per flight hour for long-haul aircraft from an average of $10,000 to more than $18,000 in some cases. A flight carrying 180 passengers could see total additional costs of about $15,000, forcing airlines to add roughly $80 per ticket just to break even.

Globally, Brazil’s Petrobras raised jet fuel prices by about 55 percent in early April, while the Philippines warned that some aircraft could be grounded due to fuel shortages, and Taiwanese carriers are preparing to increase international fuel surcharges by 157 percent.

Longer routes, heavier maintenance burdens

Al-Mirah explained that longer flight times to avoid unstable airspace carry steep financial costs, with each additional hour adding between $5,000 and $7,500. Route changes extending flight durations by one to two hours have increased fuel consumption by up to 30 percent. More time in the air also accelerates engine wear.

The strain goes beyond fuel. Increased flight hours speed up the deterioration of engines and components, bringing forward maintenance schedules and raising annual servicing costs- ultimately reducing fleet efficiency.

Airlines are also grappling with sharply higher war-risk insurance premiums. While such costs typically account for no more than 1 percent of total operating expenses, they have surged by between 50 percent and 500 percent in the current crisis, according to a March 2026 report by Lockton.

This buildup of fuel and insurance costs threatens to turn profitable routes into loss-making ones, potentially forcing cash-strapped or low-cost carriers to suspend some routes temporarily to preserve financial stability.

An aircraft from Riyadh Air at Le Bourget Airport (Reuters)

Saudi airports support regional air traffic

Amid these complexities, Saudi Arabia’s General Authority of Civil Aviation has deployed its capabilities to activate regional support protocols. Gulf airlines have shifted logistical operations to Saudi airports to keep regional air traffic safe and moving.

The authority announced that the Kingdom received more than 120 flights from neighboring countries’ carriers between February 28 and March 16, including Qatar Airways, Iraqi Airways, Kuwait Airways, Jazeera Airways, and Gulf Air.