Gulf States Face Economic Crisis Amid Unwanted War
An unsettling silence has descended upon the industrial port of Ras Al Khaimah in the United Arab Emirates. Once a bustling maritime centre, the port now lies dormant, with ships anchored and idle. On the hazy horizon, a queue of hundreds of tankers stretches into the distance, stranded along a perilous waterway. Any vessel seeking to navigate from Ras Al Khaimah into the Arabian Sea must confront the world's most dangerous shipping lane today: the Strait of Hormuz.
Direct Attacks and Regional Fallout
Merely twenty nautical miles from Ras Al Khaimah, two oil tankers bound for the strait were struck by Iranian missiles this week, one erupting in flames. This follows a drone assault on Saturday targeting Fujairah, the UAE's primary oil port on its eastern coast, where dense black smoke engulfed the terminal. These incidents underscore the severe repercussions confronting Gulf nations as they are dragged into a conflict they neither initiated nor desired.
For generations, Bahrain, Kuwait, Saudi Arabia, the UAE, Qatar, and Oman have permitted US military installations, infrastructure, or access on their territories. They have also ranked among the foremost purchasers of American armaments and technology. In exchange, the United States has served as the Gulf's principal military ally and guardian. However, analysts note escalating apprehensions among Gulf states regarding this partnership, particularly after Donald Trump appeared to deliberately sabotage peaceful diplomatic talks in favour of instigating a Middle Eastern war.
Failed Diplomacy and Military Asymmetry
In the weeks preceding the strikes, Gulf leaders facilitated negotiations and repeatedly appealed to the US president, highlighting the grave implications for regional stability should he attack Iran. Nonetheless, Trump proceeded with the strikes, widely believed to have been executed without consulting or alerting Gulf allies. While the Gulf anticipated some backlash, the magnitude of Iran's retaliatory campaign has stunned many. Gulf states had guaranteed Tehran that their bases would not be utilised for attacks, yet Iran has launched thousands of drones and missiles targeting:
- Airports and military bases
- Oil refineries and ports
- Hotels and office buildings
Regional aviation remains severely constrained, costing airlines billions of dollars. Bahrain is grappling with an economic downturn, while the UAE's image as a sanctuary for tourism and Western investment has suffered considerably. Nations are effectively repelling most Iranian missiles and drones, but the interceptor missiles and air defence systems are incurring expenses exceeding $2 billion for countries like the UAE.
Economic Strangulation and Daily Losses
Iran's aggressive blockade of the Strait of Hormuz – the sole maritime corridor connecting the Gulf with the open ocean, through which one-fifth of global energy supplies transit – has precipitated a sharp decline in the oil and gas exports that underpin Gulf economies. Specialists approximate that between $700 million and $1.2 billion is forfeited daily in oil exports alone.
"The UAE and GCC [Gulf Cooperation Council] tried to stop the United States declaring this war because they knew the implications," explains Almezaini. He referenced threats issued months prior by Iran's foreign minister concerning the strait's closure. "Now that exact scenario is playing out."
The imbalance in the Gulf's military alliance with the US has never been more pronounced, observes Allison Minor, director of the Atlantic Council's project on Middle East integration. She cites Israel's airstrikes on Qatar, another US Gulf ally, in September, which elicited no meaningful response from Washington. "The most fundamental question is one of consultation," she states. "Are the Gulf states actually achieving the kind of partnership and security support that they feel is necessary if the United States is going to engage militarily in the region?"
Legal Condemnations and Strategic Dilemmas
On Thursday, Omani Foreign Minister Badr bin Hamad al Busaidi, who mediated earlier Iran-US discussions, delivered some of his most forceful remarks on the conflict to date. "Oman's view [is] that the military attacks against Iran by the United States and Israel are illegal, and that for as long as they continue to pursue hostilities, those states that launched this war are in breach of international law," he declared.
Al Busaidi contended that the US decision to strike Iran while peaceful negotiations over Iran's nuclear programme were advancing indicated the conflict was purely an endeavour to reshape the Middle East to Israel's advantage. Analysts stress that numerous Gulf states are entangled in a contradictory stance: endeavouring to de-escalate the war while urging the US to conclude operations in Iran, ensuring they do not confront a worst-case scenario – a debilitated, injured, and unpredictable Islamic republic on their borders.
"This is the Gulf's worst nightmare," says Sanam Vakil, director of the Middle East and north Africa programme at Chatham House. "There's deep anger and frustration at the United States because this is not their [the Gulf states'] war, and yet they're bearing the brunt." Vakil notes that Gulf states have long sought a security partnership with the US akin to Israel's, but have now comprehended "that may never happen."
Pursuit of Autonomy and Civilian Impact
Despite acknowledging the necessity to diversify security allies, Vakil adds, the Gulf presently lacks any alternative as its ultimate protector. "The Gulf is not going to move quickly, nor can they, in finding alternatives to the US. But they're also not going to just double down with an unreliable partner," she elucidates. "It will likely move forward in the pursuit of strategic autonomy, which has already been on the horizon, perhaps at a more rapid pace."
Beyond geopolitical consequences, the economic repercussions have permeated daily existence. At a boat and jetski rental enterprise adjacent to Ras Al Khaimah port, Sumon, aged 27, reports that commerce has been paralysed as coastguards prohibit all vessels from venturing to sea. "For many days, our boats and jetskis aren't allowed to go out because of all these problems and fighting with Iran in the sea," he recounts. "It's very bad news, we don't have customers and my boss can't give me a salary." Gesturing towards the port, Sumon concludes, "No boats are moving any more. No one knows when it will end."
