Financial markets in the Gulf region have seen sharp divergences in performance since the start of the conflict in the Middle East, as investors navigate volatile energy prices amid continued market turmoil due to geopolitical tensions. Saudi Arabia and Oman have outperformed other regional indices, with the Muscat Securities Market index rising 9.3% since March 1, the day after the war began on February 28, while the Saudi Tadawul All Share Index climbed 5.8%. In contrast, the Dubai Financial Market General Index plummeted nearly 16% over the same period, while the Qatar Stock Exchange index fell 4% and the Bahrain All Share Index declined 7.2%.
Oil and Safe Havens Reshape Investment Landscape
Damanik Dantes, founder of Dantes Outlook, explained that the Saudi index, which is closely tied to energy markets, has received strong support from the surge in oil prices, while Oman has benefited from investors seeking safe havens. In contrast, the United Arab Emirates was the most affected, with Dantis noting its greater sensitivity to real estate markets and broader geopolitical events.
Speaking to CNBC’s Access Middle East on Thursday, Dantis emphasized that high oil prices remain a net positive for Saudi Arabia, where a small handful of major energy companies dominate the market. He highlighted in particular Saudi Aramco’s ability to export oil not through the Strait of Hormuz, the vital shipping lane that has emerged as a major flashpoint in the conflict, but rather via pipelines extending to the Mediterranean.
