An oil tanker is being loaded at Saudi Aramco's Ras Tanura oil refinery and oil terminal in Saudi Arabia May 21, 2018. (Reuters)
The non-oil trade surplus of Saudi Arabia with the Gulf Cooperation Council (GCC) countries recorded an annual growth rate of 203.2% to more than SAR2 billion in April, reported the Saudi Press Agency on Friday. It soared to around SAR3,511 million from SAR1,158 million in the same month last year.
According to preliminary data from the International Trade Bulletin for April, published by the General Authority for Statistics (GASTAT), the total volume of non-oil trade, including re-exports, between Saudi Arabia and GCC countries amounted to around SAR18,028 million. This reflects a year-on-year growth of 41.3%, with an increase of SAR5,271 million from SAR12,757 million in April 2024.
Non-oil commodity exports, including re-exports, rose by 55%, totaling SAR10,770 million, up from SAR6,958 million in April of the previous year, an increase of over SAR3,812 million.
Meanwhile, the value of national non-oil commodity exports reached around SAR3,031 million, compared to SAR2,675 million in April 2024, achieving a year-on-year growth rate of 13.3%, with an increase estimated at SAR356 million.
Additionally, the value of re-exports surged by 81%, reaching SAR7,738 million compared to SAR4,282 million, an increase of SAR3,456 million.
Saudi Arabia’s imports from GCC countries stood at SAR7,258 million in April 2025, compared to SAR5,799 million last year, achieving a year-on-year growth of 25.2%, with an increase of SAR1,459 million.
The data indicated that the United Arab Emirates ranked first in terms of non-oil trade volume with Saudi Arabia, amounting to SAR13,533 million, representing about 75.1% of the total.
Bahrain followed in second place with a trade value of SAR1,798 million (10%), while Oman ranked third with SAR1,454 million (8.1%). Kuwait was fourth with SAR819.9 million (4.5%), and Qatar came next with a value of SAR422.1 million (2.3%).
Hormuz Shock Hits Gulf Economies, Saudi Arabia Takes Center Stage in 2026https://english.aawsat.com/business/5282947-hormuz-shock-hits-gulf-economies-saudi-arabia-takes-center-stage-2026
In this picture obtained from Iran's ISNA news agency on June 8, 2026, residents take a dip as cargo and commercial vessels lie at anchor in the Strait of Hormuz off Bandar Abbas. (Photo by Amirhossein KHORGOOEI / ISNA / AFP) /
Hormuz Shock Hits Gulf Economies, Saudi Arabia Takes Center Stage in 2026
In this picture obtained from Iran's ISNA news agency on June 8, 2026, residents take a dip as cargo and commercial vessels lie at anchor in the Strait of Hormuz off Bandar Abbas. (Photo by Amirhossein KHORGOOEI / ISNA / AFP) /
The global economy is entering an extremely sensitive phase in 2026 amid escalating geopolitical tensions in the Middle East, which have cast a heavy shadow over the fragile global recovery and reshaped the global credit and financial landscape.
At the heart of these turbulent developments, Gulf Cooperation Council economies find themselves directly confronting the fallout from disruptions in energy markets and supply chains resulting from the effective closure of the Strait of Hormuz, according to the World Bank. While this shock has placed the region’s growth under severe pressure, pushing overall growth rates toward near-zero levels, Saudi Arabia has emerged as the strongest expected economic performer among its neighbors, supported by financial buffers and flexible logistical capabilities that have strengthened its ability to contain the impact of the current crisis.
According to the World Bank Group’s June Global Economic Prospects report, rising inflationary pressures, higher energy prices, and tighter monetary policies are driving global growth to lower levels. These combined factors have led the bank to lower its global growth forecast for 2026 to 2.5 percent, compared with about 2.9 percent in 2025, marking a path below its previous January forecast of 2.6 percent.
The crisis has placed two-thirds of the world’s economies under downward revisions, amid stark warnings of a darker global economic scenario known as “fuel and financing stress,” which could push growth down to 1.3 percent if supply disruptions worsen and are accompanied by acute financial pressures. Estimates point to a partial recovery in 2027 to 2.8 percent, although that would remain below the average of the previous decade.
King Fahd Industrial Port in Yanbu, Saudi Arabia (SPA)
Energy Markets, Inflation, and the Impact of Hormuz
Energy markets are at the center of the crisis, having been directly affected by geopolitical developments, particularly the closure of the Strait of Hormuz, which has led to severe disruptions in global supplies.
The World Bank expects Brent crude to average about $94 per barrel in 2026, representing an increase of roughly 36 percent compared with 2025, provided disruptions subside by July.
The repercussions are not limited to oil. Fertilizer prices are also expected to rise, increasing pressure on global food prices and pushing global inflation to around 4 percent, compared with 3.3 percent in 2025, with the possibility of reaching 4.4 percent under the worst-case scenario.
Gulf and Middle East Economies on the Front Line
Saudi Arabia’s economic leadership in the latest June update was not unexpected. Figures published in the World Bank’s April report indicate that the Kingdom has not only succeeded in building solid “economic buffers” but has also turned current geopolitical challenges into an opportunity to accelerate structural adjustment, reflected in growth of 3.1 percent.
The updated estimates and figures released today reinforce that outlook and underscore this structural advantage. The World Bank revealed figures reflecting the depth of the regional shock as follows:
Middle East and North Africa growth declines: The bank expects overall growth in the region to fall sharply (excluding Iran due to exceptional uncertainty) to just 1.6 percent in 2026, compared with about 4 percent in 2025, representing a severe downward revision of 2.7 percentage points from last January’s forecast.
Near paralysis across Gulf and regional economies: Perhaps the bleakest indicator in the June report is the decline in overall growth among oil-exporting economies in the Middle East to just 0.3 percent in 2026, a downward revision of 4.3 percentage points from January’s forecast. This reflects disruptions to production and export lines. The figure marks a significant deepening of the shock compared with the bank’s April report, which had lowered regional growth forecasts at the time to 1.3 percent from an earlier projection of 4.4 percent. Current estimates show Gulf economies collectively slowing from 3.9 percent growth in 2025 to levels that constrain economic activity and approach zero in 2026, before rebounding toward recovery at around 5 percent in 2027 and 2028, driven by a recovery in trade flows and the launch of reconstruction projects.
Vessels are anchored in the Strait of Hormuz, as seen from Musandam, Oman, June 10, 2026. REUTERS/Stringer
The Geopolitical Structure Behind Diverging Performance
The World Bank attributed the sharp divergence in performance among Middle Eastern oil exporters to varying degrees of exposure to military activity and differences in policy buffers. The report noted that the slowdown would be less severe in Saudi Arabia due to its strategic ability to reroute oil exports away from logistical disruption through the East-West Pipeline leading to the Red Sea.
In a related context, the bank expects a more moderating slowdown in Oman, as it faces lower direct risks because its main ports lie outside the closed Strait of Hormuz. By contrast, the report links the sharp contraction in the economies of Kuwait, Qatar, and Iraq to a forced decline in oil production resulting from damage to energy infrastructure and the suspension of shipping through the strait, alongside surging shipping costs and rising defense and military spending pressures on government budgets.
Performance Across Gulf States
The updated estimates reinforce the figures anticipated by the World Bank in its April report regarding the performance gap among countries in the region as follows:
Saudi Arabia: Despite the World Bank deepening its downward revisions for the region as a whole in June to 1.6 percent due to the Hormuz shock, the Kingdom maintained its position as the region’s top performer. Growth is expected to reach 3.1 percent in 2026, down 1.2 percentage points from January estimates because of energy market conditions, before rebounding strongly to 4.9 percent in 2027.
United Arab Emirates: Growth expectations have been revised down by 2.7 percentage points since January. Growth is now expected to slow from 5 percent in 2025 to 2.4 percent in 2026, before rising again to 4.1 percent in 2027.
Qatar: Growth expectations for the Qatari economy have fallen sharply by 11.0 percentage points since January. The economy is now expected to contract by 5.7 percent, compared with previously projected positive growth of 5.3 percent, due to severe damage to liquefied natural gas supplies. Qatar is a key player in the global energy market, accounting for between 20 percent and 21 percent of global LNG supplies. The World Bank expects Qatari growth to rebound to 5.7 percent.
Kuwait: The economy is expected to contract by 6.4 percent, compared with a growth forecast of 2.6 percent in January. Kuwait relies entirely on the Strait of Hormuz to export its crude oil and petroleum products. The closure of the strait therefore means a complete shutdown of the country’s financial lifeline, immediately halting budget revenue inflows. The World Bank expects Kuwait’s economic growth to surge to 13.5 percent in 2027.
Bahrain: Growth expectations have been revised down by 1.8 percentage points since January. Growth is now expected to slow from 3.1 percent in 2025 to 1.3 percent in 2026 before rising again to 2.8 percent in 2027.
Oman: Growth expectations for Oman’s economy have been revised down by 1.2 percentage points since January. Growth is now expected to slow from 3.6 percent in 2025 to 2.4 percent in 2026 before increasing to 3 percent in 2027.
Perhaps the greatest shock lies in the freefall of the Iraqi economy, with growth expectations plunging from 6.5 percent to a steep contraction of 8.9 percent.
Egypt Defies the Downward Trend
In contrast to the sharp contraction affecting the budgets of oil-producing Gulf states, the World Bank raised its forecast for Egypt’s economic growth by 0.3 percentage points to 4.6 percent in 2026, before easing to 4 percent in 2027.
This relative recovery is attributed to Egypt’s logistical and geographic advantages, as a significant share of international trade and supply chains shifts toward alternative routes through the Red Sea and the Suez Canal to avoid disruption caused by the closure of the Strait of Hormuz. The diversity of Egypt’s economy and its lack of direct dependence on Gulf oil exports have also helped shield it from the immediate shock, alongside recent inflows of foreign direct investment and international support packages that have provided strong foreign-currency liquidity and enhanced the resilience of non-oil activity and domestic demand against geopolitical headwinds.
Diverging Outlooks
At the regional level, the data show varying performance across global regions. South Asia remains the fastest-growing region despite slowing to 6.3 percent, while growth in East Asia is projected at 4.2 percent and Sub-Saharan Africa at 4 percent.
Latin America is expected to grow by 2.2 percent, followed by Europe and Central Asia at 2.1 percent. Meanwhile, the Middle East and North Africa region is more heavily affected by the conflict, with growth slowing to 1.6 percent in 2026 before recovering to 5 percent in 2027.
Commenting on these difficult developments, World Bank Group President Ajay Banga said the greatest challenge facing governments today is achieving a careful balance between protecting current financial stability and preserving future growth opportunities.
Banga said the World Bank is working intensively to support affected countries through liquidity tools and emergency financing, while remaining fully prepared to provide additional support packages should the crisis worsen, with the aim of helping economies overcome the structural shock to energy markets and strengthen their capacity for sustainable recovery.
SpaceX on Cusp of Record IPO that Could Make Musk a Trillionairehttps://english.aawsat.com/business/5282779-spacex-cusp-record-ipo-could-make-musk-trillionaire
SpaceX on Cusp of Record IPO that Could Make Musk a Trillionaire
FILE - SpaceX's mega rocket Starship prepares for a test flight from Starbase in Boca Chica, Texas, Monday, Nov. 18, 2024. (AP Photo/Eric Gay, File)
SpaceX enters the final stretch Thursday before its expected trading on Wall Street as part of the biggest initial public offering in history, which could propel co-founder Elon Musk to trillionaire status.
The company will be the first out of the gates among the tech and AI giants eyeing public markets, with OpenAI and Anthropic expected to follow, as both have filed with regulators for their own market debuts, AFP said.
If all goes as expected, the space and rocket company co-founded by Musk in 2002 will begin trading on the Nasdaq exchange on Friday morning, with all eyes on how Wall Street will absorb the blockbuster IPO that could send tremors across global markets.
For high-profile companies, the first day of trading traditionally sees executives ring the opening bell to mark the start of the session -- in this case at New York's Times Square, home of the Nasdaq.
The IPO is Musk's biggest financial gamble yet, with his xAI company and the X social media platform (formerly Twitter) also included in the SpaceX offering after the multi-billionaire folded them into the company earlier this year.
The company will offer more than 555 million shares at an expected $135, placing SpaceX among Wall Street's most elite companies with a valuation of around $1.8 trillion.
The operation will become official on Thursday, including the pricing, with questions swirling over whether the company will raise its offer price amid reports that it attracted more than four times the available shares, according to Bloomberg.
Thirty percent of the shares will be reserved for retail investors, triple the amount that is typically allocated in IPOs, giving Musk fans a chance to fork over for a slice of the company.
- Data centers in space -
The success of the IPO rests squarely on investors' faith in Musk as a visionary entrepreneur. The tech multi-billionaire will serve as chief executive, chief technology officer and board chairman of the newly traded company.
The IPO is expected to mint thousands of new millionaires and many billionaires, with former and current employees -- and a long list of investors -- from the company's near quarter-century history looking to cash in.
The financials of the company are giving some on Wall Street pause, as the valuation largely depends on Musk delivering on promises worthy of science fiction, including putting data centers in space as well as people on Mars using as yet unproven technology.
While the company is growing fast -- revenue hit $18.7 billion in 2025 -- it is also losing money, producing a net loss of $4.9 billion.
In an extraordinary prediction, SpaceX's filing claims it can pull in over $28.5 trillion in revenue from its various markets.
ECB Set for 'Insurance Hike' as Iran War Fans Euro Zone Inflationhttps://english.aawsat.com/business/5282776-ecb-set-insurance-hike-iran-war-fans-euro-zone-inflation
FILE PHOTO: Dark clouds are seen over the building of the European Central Bank (ECB) in Frankfurt, Germany, June 6, 2024. REUTERS/Wolfgang Rattay/File Photo
ECB Set for 'Insurance Hike' as Iran War Fans Euro Zone Inflation
FILE PHOTO: Dark clouds are seen over the building of the European Central Bank (ECB) in Frankfurt, Germany, June 6, 2024. REUTERS/Wolfgang Rattay/File Photo
The European Central Bank is all but certain to raise interest rates on Thursday in the hope of nipping higher inflation in the bud before a surge in energy costs triggered by the Iran war spreads more broadly across the euro zone economy.
The well-telegraphed move would come as inflation in the 21-country currency bloc is already above 3%, well in excess of the ECB's 2% target, and economic growth is very weak - a backdrop that has economists split over the case for tighter policy.
ECB policymakers, some of whom had already pushed for action in April, are nonetheless expected to press ahead, seeking to keep a lid on inflation expectations and to safeguard their credibility after being slow to react to a post-pandemic inflation spike in 2022.
"The ECB needs to hike to protect credibility and prevent inflation expectations from de-anchoring, but it is still operating around neutral rather than moving decisively into restrictive territory," Annalisa Piazza at MFS Investment Management said.
Thursday's hike would be the first in nearly three years and take the ECB's benchmark deposit rate to 2.25% from 2.0%. Sources have told Reuters the ECB is unlikely to commit to further rate rises this week but financial markets expect another two over the coming year, with the next move seen as soon as September.
The bank's new economic projections are also likely to hint at further rate hikes.
"New staff projections are likely to be consistent with three hikes and (ECB President) Lagarde is unlikely to dismiss this as unreasonable," JPMorgan's Greg Fuzesi said. "That would give the meeting a clear hawkish feel, even if the communication is likely to be more consistent with the next move in September."
AN 'INSURANCE HIKE' THAT UNDERPINS EXPECTATIONS
Several ECB watchers have characterized the expected move as an "insurance hike" - a precautionary step that could be reversed if price pressures fade.
Supporting the case for action, the ECB is likely to raise its quarterly inflation projections on Thursday, bringing them closer to its "adverse" scenario published in March, which saw inflation peaking at 4.2% in the final quarter of this year before falling back sharply in 2027. Consumers, companies and financial investors have revised their own views about price hikes, although medium-term expectations remain close to the ECB target and far from their levels in the aftermath of Russia's invasion of Ukraine.
"Two hikes this year thus looks like a minimum," Anatoli Annenkov at Societe Generale said. "Markets are likely to start pricing in the next hike in July... but we still think a majority of governors would prefer to wait for more data and new forecasts in September."
HEADING FOR A POLICY MISTAKE?
Not all economists are convinced. Some warn the ECB risks tightening into an economy that is already paying a high price for the Iran war.
Berenberg's Holger Schmieding said the ECB was "heading for a policy mistake" given a stagnant labor market and weak consumer demand.
"Amid the ongoing destruction of demand, the inevitable temporary surge in prices ... seems unlikely to turn into a protracted inflation problem that would need to be addressed by higher rates," he wrote in a note. A Reuters analysis of earnings call transcripts by euro zone companies showed just 40% of those outside the financial sector had raised prices or were planning to do so, roughly half the share seen as the Ukraine war pushed up energy prices in 2022.
Eric Dor, director of economic studies at France's IESEG School of Management, said the ECB was overestimating its ability to influence household and business expectations, particularly in a situation where inflation is driven by fuel costs rather than domestic demand. But the ECB has sharpened its messaging in support of tighter policy. Chief Economist Philip Lane - typically seen as an inflation "dove" - has said the Iran-related shock may be broader in scope than the Ukraine crisis, as it affects global energy markets rather than primarily Europe.
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