GULF WEEKLY: Iran strikes ships and the UAE, Saudi Q1 deficit surges, PIF issues bonds

GULF COUNTRIES - Report 08 May 2026 by Justin Alexander

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A skimmable summary overlaid with our analysis and links. Headlines:

* Trump’s “Project Freedom” in Hormuz led to the first Iranian fire at ships and the UAE in a month.
* At the same time, there was talk of progress in peace proposals; oil yoyoed in the $96-114 range .
* Saudi Arabia and Kuwait relinquished support for Project Freedom mid-week.
* OPEC+ made another largely nominal small taper in the 2023 voluntary cuts.
* Saudi Arabia’s deficit surged to 10% of GDP in Q1 as spending rose by 20% y/y.
* Saudi borrowing in Q1 totaled $40bn, more than half in domestic private placements.
* PIF issued a record $7bn in 3 to 30-year bonds this week, with strong demand and tight spreads.
* PMIs partially rebounded in Saudi Arabia, Qatar and Kuwait; the UAE’s dipped but is the strongest.
* The UAE exited OAPEC, the Arab oil exports group, which does not control production.
* Emirates Group achieved 7% growth in pre-tax profit to a record $6.6bn in the FY to March.
* S&P affirmed Qatar at AA (Stable) despite forecasting a -40% drop in LNG exports this year.
* Oman’s tourism only declined by -5% in March, although European visitors were down -20%.
* Bahrain’s business confidence index fell sharply to 83, on par with its low point during Covid.
* Bahrain’s parliament unanimously expelled 3 MPs who had criticized citizenship stripping over Iran.
* Databank updates: Saudi fiscal, Qatar and Abu Dhabi forecasts, PMIs, oil quotas, Qatar population.