IMF Cuts Gulf Growth Forecasts Amid Prolonged Hormuz Disruption

The International Monetary Fund lowered its 2026 growth forecasts for Gulf economies as prolonged disruption of the Strait of Hormuz weighs on energy exports and trade. It projects contractions of 3.3% in Saudi Arabia and 3.9% in the United Arab Emirates, alongside declines of 11.3% in Bahrain, 16.7% in Kuwait and 15.6% in Qatar. Its baseline assumes reopening begins in March 2027 and shipping broadly returns to pre-war conditions by October 2027. Under those assumptions, Saudi Arabia would grow 7.9% in 2027 and the UAE 7.7%, with double-digit rebounds in Bahrain, Kuwait and Qatar.