How the War Is Redefining Gulf Economic Power and Energy Strategy
The Gulf Cooperation Council (GCC) states are confronting the greatest threat to their economic security and energy strategy since their formation. The economic fallout of the US-Israeli war with Iran is severe, but uneven across the Gulf. So too is each state’s ability to sustain energy exports and protect critical infrastructure—both of which have been targeted unequally by Iran.
The US-Israeli war against Iran has created the largest disruption to global oil and liquefied natural gas supplies in modern history. There is a tremendous amount of economic uncertainty for Gulf states to navigate, and it will reshape the way they engage with one another and with Iran, Israel, and the United States for years to come. But this war has also laid bare how urgently the United States needs to update its own approach toward the Gulf states when it comes to energy.
China’s Model of Power Projection in the Middle East
China’s expanding role in the Middle East is often framed as geopolitical rivalry with other global powers, including the United States, Russia, India, and others; but this lens obscures the strategic subtlety of Beijing’s approach.
Strikes (and Now Boots?) Without Strategy as Iran War Escalates
“Tactics without strategy is the noise before defeat” is a well-known axiom attributed to the ancient Chinese military general and strategist, Sun Tzu. With the Iran war now at the one-month mark, it is evident that the Trump administration failed to outline a clear end state or devise a workable war termination strategy before initiating Operation Epic Fury on February 28.
The Ripple Effects of the US-Israel War on Iran for North Africa
North African states feel the consequences of the US-Israel war with Iran less through direct security risks than through economic shocks that affect long-term stability. The region remains highly exposed to disruptions in global food and energy markets, where price spikes can lead to fiscal pressure, inflation, and social unrest.
What vulnerabilities has the Iran crisis exposed in GCC economies?
The economic stress points vary considerably across the Gulf. Assuming a resumption of exports by May, Kuwait, Iraq, Bahrain, and Qatar still face sharply declining revenues and contracting GDP—as much as 14 percent in Kuwait and Qatar—because of shut ins, time to restart, and lack of alternative delivery routes. After the Iranian attacks on Ras Laffan, Qatar’s economic outlook and time to recovery look much more difficult.
Despite claiming they are poised to attack, the Yemeni Houthis have yet to join Iran and its other proxies in their fight against the United States and Israel. Hosts Alistair Taylor and Matthew Czekaj speak to MEI Associate Fellow Nadwa Al-Dawsari to unpack why the Houthis continue to stay on the sidelines of the Iran war and what might prompt them to join the fray. They also discuss the Houthis’ evolving role within the Axis of Resistance, what the Yemeni group has learned from its earlier rounds of direct conflict with Israel and the US, as well as whether its actions could precipitate a renewed flareup in Yemen’s civil war.
The relative resilience of GCC countries to the Iran crisis
Gulf states — including their national oil companies and sovereign and related entities — are energy giants. They understand the risks of a prolonged threat from Iran and did not choose this war. They also recognize the risks of their geographic location, should the region endure another bout of instability and dislocation from a fragmented and collapsing neighbor.
If the Regime Survives: Iran War Raises the Ante for US, Israel
The United States and Israel both hope for the grand prize: the emergence of a new regime in Iran to replace the Islamic Republic. For the US, this would close the chapter on a hostile and at times violent relationship that has endured since 1979. For Israel, this would see the end not only of a regime with a deep ideological commitment against it but also the foe that Israel sees as behind all fronts of the war it has fought since October 7, 2023.
Iraq’s oil paralysis: A self-inflicted wound and a gift to Tehran
With the Strait of Hormuz closed and oil production from Iraq’s south in free fall, Baghdad’s failure to maximize the Iraq-Turkey Pipeline is no longer a policy dispute. It is a national emergency.
Iran’s insurance policy: Why the Houthis have stayed out of the fight
Nearly two weeks into the Iran war, one of Tehran’s most capable and disruptive regional allies, Yemen’s Houthi movement, has not entered the fight. The Houthis’ restraint reflects a strategic calculation by Iran’s Islamic Revolutionary Guard Corps.
After Khamenei: Iran enters its most uncertain transition since 1979
For nearly four decades, Ayatollah Ali Khamenei embodied the Islamic Republic’s certainty: a singular authority who shaped every major decision on war and peace, repression and reform, economics and ideology. His death, in a coordinated US-Israeli strike on his Tehran command compound on February 28, has ripped that certainty away in the most violent fashion imaginable.
How Iran, China, and Russia Use the Shadow Fleet to Evade US Sanctions
Crude oil legally sanctioned by the United States and its allies today makes up an estimated 18% of global tanker capacity, or 6-7% of total unrefined petroleum flows — shares that have been growing. Increased pressure on Russian exports and US intervention in Venezuela have further constrained Russian flows and temporarily removed Venezuela, the smallest sanctioned producer, from the market. Iranian exports, however, remain largely untouched.
The Gulf states are betting big on artificial intelligence (AI). Their motive is simple: While hydrocarbons will remain part of the energy mix for the foreseeable future, the revenue and influence tied to crude are already beginning to diminish. AI is not just about technology; it is a hedge, and potentially a new foundation for sustaining and even increasing their power in the rapidly shifting world order.
Saudi Arabia has stepped up its efforts to unify and restructure Yemen’s anti-Houthi forces after the rapid expansion and sudden implosion of the United Arab Emirates-backed secessionist Southern Transitional Council following Abu Dhabi’s military withdrawal from the country.
