Gulf bourses tumble as Middle East conflict intensifies, oil prices surge
Escalating hostilities in the Middle East pushed most Gulf stock markets lower while Brent crude jumped nearly 3%, raising expectations for higher oil prices.
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Desk Analysis
How This Affects the Exchange
Sector Effect
Positive · Buy bias
Rising oil prices boost Oil & Gas sector; Buy bias for related tickers.
Sectors & Direction
Desk read
Desk call: Buy bias · Positively affected
- Oil & GasPositively affected
Companies
Mentions in This Briefing
Sectors: Oil & Gas — Positive · Buy bias. PSX tickers: OGDC, PPL. Rising oil prices boost Oil & Gas sector; Buy bias for related tickers.
Full Story
Open on Business Recorder## Conflict escalation and market reaction
The latest flare‑up in the Middle East saw Houthi forces strike several Saudi cities, igniting key oil facilities and pulling a major U.S. ally deeper into the fighting. U.S. forces responded by hitting multiple Iranian oil tankers, prompting retaliatory attacks on commercial vessels and a U.S. base in Jordan. The multi‑front confrontation has heightened concerns over regional energy output and the safety of vital trade routes, especially the Red Sea corridor, as the Strait of Hormuz remains largely blocked.
## Gulf equity indices slide
Saudi Arabia’s benchmark index slipped 0.2%, led by a 1.7% fall in Saudi National Bank, the kingdom’s largest lender by assets. Dubai’s main share index dropped 0.3%, weighed down by a 1.8% decline in Emirates NBD. Qatar’s index eased 0.1%, with petrochemical producer Industries Qatar down 1.9%. The broader GCC equity market faced renewed caution as geopolitical risk premiums rose.
## Oil prices rally
Brent crude futures rose $2.77, or 2.83%, to $100.69 a barrel by 1033 GMT. Major banks such as Goldman Sachs and Bank of America lifted their oil price forecasts, citing tightening supplies as the catalyst for the multi‑week high in crude.
## Outlook
Analysts note that continued volatility in the Oman‑Iran waterway agreement and ongoing tanker attacks in the Strait of Hormuz keep energy‑supply risks elevated. While the heightened tension caps sentiment for GCC equities, resilient domestic fundamentals in the region may limit broader downside. Any credible de‑escalation could unlock a rebound in the Gulf markets.
## Implications for Pakistan
Higher global oil prices are likely to benefit Pakistan’s listed oil‑and‑gas companies, improving revenue expectations and potentially supporting their share prices on the Pakistan Stock Exchange.