GCC Weekly

Research evidence excerpt

GCC Weekly

reopening baseline, as has been the dence, the normalization of supply should help ease the limit-

case in recent months. ed inflationary pressures observed so far.

Hydrocarbons. Reopening Hormuz would enable a gradual

Figure 3: GCC headline forecast evolution

recovery in hydrocarbon production. Countries with spare

% Pre-conflict 13/03/26 revision

capacity—such as the UAE and Saudi Arabia—could poten- 8 16/04/26 revision Current forecast

tially produce above pre-war levels by 4Q26. The re-opening 6

would be particularly significant for countries constrained by 2

Hormuz, such as Kuwait (where oil production accounts for 0

-2

almost half of the economy) and Qatar. This last could restore -4

about 80% of output within two months as the remaining -6

-8

capacity may take longer to recover due to damage inflicted -10

on Ras Laffan in March (link). -12

-14

GCC* BHR KUW OMN QAT* KSA UAE

Source: J.P. Morgan *also revised after Ras Laffan attack

Figure 1: Hydrocarbon importance in GCC

% GDP

50 Twin balances. Higher oil export volumes should support a

strong recovery in revenues, especially in Qatar and Kuwait,

40 OMN KUW

which have limited alternatives to the Strait for oil trade. For revenues

30 QAT Saudi Arabia and the UAE—both of which have been able to

maintain some exports via bypass pipelines—the volume 20 UAE GCC

effect should be more muted, particularly given the recent hydrocarbon 10 BHR KSA decline in oil prices. Our current assumption remains for pric- CA

0 es averaging $96/bbl in 2026 and around $100/bbl through

0 10 20 30 40 50 4Q, though this view carries greater downside risk in light of

Source: J.P. Morgan 2025est Hydrocarbon sector as % of GDP the market’s reaction to the news.

Improved activity and the resumption of trade in other key