Investors brace for oil price spike, rush to havens after US bombs Iran nuclear sites

Investors brace for oil price spike, rush to havens after US bombs Iran nuclear sites
While global benchmark Brent crude futures have risen as much as 18 percent since June 10, hitting a near five-month high of $79.04 on Thursday, the S&P 500 has been little changed, following an initial drop when Israel launched its attacks on Iran on June 13. Shuttestock
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Updated 22 June 2025
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Investors brace for oil price spike, rush to havens after US bombs Iran nuclear sites

Investors brace for oil price spike, rush to havens after US bombs Iran nuclear sites

NEW YORK: A US attack on Iranian nuclear sites could lead to a knee-jerk reaction in global markets when they reopen, sending oil prices higher and triggering a rush to safety, investors said, as they assessed how the latest escalation of tensions would ripple through the global economy.

The attack, which was announced by President Donald Trump on social media site Truth Social, deepens US involvement in the Middle East conflict. That was the question going into the weekend, when investors were mulling a host of different market scenarios.

In the immediate aftermath of the announcement, they expected the US involvement was likely to cause a selloff in equities and a possible bid for the dollar and other safe-haven assets when trading begins, but also said much uncertainty about the course of the conflict remained.

Trump called the attack “a spectacular military success” in a televised address to the nation and said Iran’s “key nuclear enrichment facilities have been completely and totally obliterated.” He said the US military could go after other targets in Iran if the country did not agree to peace.

“I think the markets are going to be initially alarmed, and I think oil will open higher,” said Mark Spindel, chief investment officer at Potomac River Capital.

“We don’t have any damage assessment and that will take some time. Even though he has described this as ‘done,’ we’re engaged. What comes next?” Spindel said.

“I think the uncertainty is going to blanket the markets, as now Americans everywhere are going to be exposed. It’s going to raise uncertainty and volatility, particularly in oil,” he added.

Spindel, however, said there was time to digest the news before markets open and said he was making arrangements to talk to other market participants.

Oil prices, inflation

A key concern for markets would center around the potential impact of the developments in the Middle East on oil prices and thus on inflation. A rise in inflation could dampen consumer confidence and lessen the chance of near-term interest rate cuts.

“This adds a complicated new layer of risk that we’ll have to consider and pay attention to,” said Jack Ablin, chief investment officer of Cresset Capital. “This is definitely going to have an impact on energy prices and potentially on inflation as well.”

While global benchmark Brent crude futures have risen as much as 18 percent since June 10, hitting a near five-month high of $79.04 on Thursday, the S&P 500 has been little changed, following an initial drop when Israel launched its attacks on Iran on June 13.

Before the US attack on Saturday, analysts at Oxford Economics modeled three scenarios, including a de-escalation of the conflict, a complete shutdown in Iranian oil production and a closure of the Strait of Hormuz, “each with increasingly large impacts on global oil prices.”

In the most severe case, global oil prices jump to around $130 per barrel, driving US inflation near 6 percent by the end of this year, Oxford said in the note.

“Although the price shock inevitably dampens consumer spending because of the hit to real incomes, the scale of the rise in inflation and concerns about the potential for second-round inflation effects likely ruin any chance of rate cuts in the US this year,” Oxford said in the note, which was published before the US strikes.

In comments after the announcement on Saturday, Jamie Cox, managing partner at Harris Financial Group, agreed oil prices would likely spike on the initial news. But Cox said he expected prices to likely level in a few days as the attacks could lead Iran to seek a peace deal with Israel and the US.

“With this demonstration of force and total annihilation of its nuclear capabilities, they’ve lost all of their leverage and will likely hit the escape button to a peace deal,” Cox said.

Economists warn that a dramatic rise in oil prices could damage a global economy already strained by Trump’s tariffs.

Still, any pullback in equities might be fleeting, history suggests. During past prominent instances of Middle East tensions coming to a boil, including the 2003 Iraq invasion and the 2019 attacks on Saudi oil facilities, stocks initially languished but soon recovered to trade higher in the months ahead.

On average, the S&P 500 slipped 0.3 percent in the three weeks following the start of conflict, but was 2.3 percent higher on average two months following the conflict, according to data from Wedbush Securities and CapIQ Pro.

Dollar woes 

An escalation in the conflict could have mixed implications for the US dollar, which has tumbled this year amid worries over diminished US exceptionalism.

In the event of US direct engagement in the Iran-Israel war, the dollar could initially benefit from a safety bid, analysts said.

“Do we see a flight to safety? That would signal yields going lower and the dollar getting stronger,” said Steve Sosnick, chief market strategist at IBKR in Greenwich, Connecticut. “It’s hard to imagine stocks not reacting negatively and the question is how much. It will depend on Iranian reaction and whether oil prices spike.”


Jordan targets 80% debt-to-GDP ratio by 2028 as it backs IMF reforms

Jordan targets 80% debt-to-GDP ratio by 2028 as it backs IMF reforms
Updated 13 sec ago
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Jordan targets 80% debt-to-GDP ratio by 2028 as it backs IMF reforms

Jordan targets 80% debt-to-GDP ratio by 2028 as it backs IMF reforms

RIYADH: Jordan aims to lower its public debt-to-gross domestic product ratio to 80 percent by 2028 under an International Monetary Fund-backed reform program, according to a government official. 

Finance Minister Abdul Hakim Al-Shibli said the plan is designed to strengthen macroeconomic and financial stability, support sustainable growth, and maintain fiscal space without adding burdens on citizens, according to a statement reported by the Jordan News Agency, also known as Petra. 

This comes as the IMF completed the third review of Jordan’s Extended Fund Facility and approved a new 48-month, $700 million Resilience and Sustainability Facility on June 25. 

The new facility is intended to enhance long-term resilience in the energy, water, and health sectors while advancing climate and pandemic preparedness efforts. 

The Petra report stated: “Al-Shibli explained that the reform package aligns with Jordan’s Economic Modernization Vision and encompasses a broad array of structural measures, including enhancements to tax compliance, expansion of the tax base, fiscal sustainability in the electricity sector, improvements in public service delivery, and a more conducive environment for private sector-led job creation.” 

It added: “He underscored that the successful completion of the third review under the national reform program constitutes a strong vote of confidence in Jordan’s economic resilience and the effectiveness of its fiscal and monetary policies, especially amid regional instability.” 

The minister said completing the review will release $134 million from the IMF, helping improve liquidity and boost investor confidence. 

Addressing public concerns that IMF-backed reforms could lead to higher taxes or austerity measures, Al-Shibli emphasized that Jordan’s engagement with the fund is based on a collaborative, nationally driven framework. 

“From the outset, Jordan has insisted that the program’s objectives align with our national strategies particularly the Economic Modernization Vision while ensuring no additional financial burdens are placed on citizens,” he said. 

Al-Shibli noted that the $700 million Resilience and Sustainability Facility, approved by the IMF’s Executive Board, will fund priority capital projects while promoting energy efficiency, water resource management, and pandemic preparedness. 

These funds, deposited with the central bank, were strategically used to redeem maturing eurobonds, helping avoid costly new issuances. Al-Shibli noted that current market conditions could have pushed interest rates as high as 9 percent, compared to the 4.8 percent yield secured through a recent sukuk issuance. 

The IMF praised Jordan’s stronger-than-expected performance in 2024, with full-year GDP growth reaching 2.5 percent, exceeding projections of 2.3 percent. This helped maintain the country’s sovereign credit rating and reflected sound fiscal and monetary management amid geopolitical uncertainty. 

This comes after Jordan’s GDP grew by 2.7 percent at constant prices in the first quarter of 2025, up from 2.2 percent during the same period last year, according to the Department of Statistics, as reported by the Jordan News Agency. 

Addressing rising debt levels, Al-Shibli said public debt stood at 35.8 billion Jordanian dinars ($50.49 billion), or 93 percent of GDP, in early 2025. He attributed the increase to fiscal deficit financing, losses at state utilities, and the inflow of $1 billion in concessional loans. 

However, debt is expected to decline to 35.3 billion dinars by the end of June, with the debt-to-GDP ratio — excluding Social Security Investment Fund holdings — seen falling to about 91 percent. 

On the sectoral front, and according to data from the Department of Statistics, agriculture recorded the highest growth in the first quarter of 2025 at 8.1 percent, followed by the electricity and water sector at 5.8 percent, and manufacturing at 5.1 percent. 

The manufacturing sector made the largest contribution to overall GDP growth, followed by agriculture and the finance, insurance, and real estate sectors.


Qatar’s economy sees annual growth of 3.7% 

Qatar’s economy sees annual growth of 3.7% 
Updated 29 min 53 sec ago
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Qatar’s economy sees annual growth of 3.7% 

Qatar’s economy sees annual growth of 3.7% 

RIYADH: Qatar’s economy expanded by 3.7 percent in real terms in the first quarter of 2025 compared to the same period a year earlier, driven primarily by robust gains in non-hydrocarbon sectors. 

According to data released by the National Planning Council, gross domestic product at constant prices rose to 181.5 billion Qatari riyals ($49.8 billion), up from 175 billion riyals in the first quarter of 2024. 

The latest figures reflect the country’s ongoing efforts to reduce reliance on hydrocarbons and foster private sector growth, with the non-hydrocarbon economy accounting for 63.6 percent of real GDP, an increase from 62.6 percent a year earlier. 

Non-hydrocarbon activities grew by 5.3 percent year-on-year, supported by strong performances across manufacturing, construction, real estate, wholesale and retail trade, and services. 

This growth aligns with the ambitions set out in the Third National Development Strategy, which targets an annual 4 percent expansion in non-hydrocarbon GDP by 2030. 

More broadly across the region, Saudi Arabia’s economy grew by 3.4 percent year on year in the first quarter of 2025, driven by a 4.9 percent increase in non-oil GDP and a 3.2 percent rise in government activity.

Commenting on Qatar’s recent data, Secretary General of NPC Abdulaziz Al-Khalifa stated: “These indicators highlight the progress of Qatar’s economy, particularly in terms of non-hydrocarbon economic growth, whose activities have recorded remarkable growth demonstrating greater diversification and stability for Qatar’s economy as the State continues to strive to build a sustainable economy.” 

According to a report by the Qatar News Agency, Al-Khalifa added: “The current growth rates also indicate additional opportunities for development, as there remains significant potential that we seek to unlock through the Third National Development Strategy to continue to build sustainable economic growth that offers unique investment and entrepreneurial opportunities for the private sector.” 

The manufacturing sector expanded by 5.6 percent, while construction grew by 4.4 percent and real estate advanced by 7 percent. 

Wholesale and retail trade saw the sharpest increase, rising by 14.6 percent compared to the same period in 2024. 

Smaller segments of the economy also posted notable gains, including accommodation and food services, which grew by 13.8 percent, and transport and storage, which rose by 3.5 percent. 

These developments indicate broad-based momentum across diverse areas of economic activity. 

Service industries also contributed to the expansion, with professional, scientific and technical activities growing by 7.2 percent, human health and social work by 2.6 percent, and the education sector recording a marginal gain of 0.1 percent. 

The National Statistics Center noted that these trends reflect continued prioritization of human capital development and improvements in quality of life, both central objectives of national policy. 

To enhance the accuracy of economic measurement, the National Statistics Center implemented an updated methodology for calculating GDP and revised quarterly data covering the period from 2018 to 2024. 

The revisions included updated indicators and advanced calculations aligned with international standards. 

Despite persistent global economic uncertainty and fluctuations in energy markets, hydrocarbon activities continued to grow modestly, accounting for 36.4 percent of real GDP, equivalent to 66 billion riyals, and rising by 1 percent compared to the first quarter of 2024. 

The NPC emphasized that this performance demonstrates the resilience of Qatar’s hydrocarbon sector alongside expanding non-hydrocarbon contributions.


Morgan Stanley Saudi Arabia to act as market maker for 52 companies: Tadawul 

Morgan Stanley Saudi Arabia to act as market maker for 52 companies: Tadawul 
Updated 01 July 2025
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Morgan Stanley Saudi Arabia to act as market maker for 52 companies: Tadawul 

Morgan Stanley Saudi Arabia to act as market maker for 52 companies: Tadawul 

RIYADH: Morgan Stanley Saudi Arabia has been approved to conduct market-making activities for 52 companies listed on the Kingdom’s stock exchange, according to a statement on Tadawul.

The US-based multinational investment banking company’s applications are set to cover securities on the main and parallel markets, commencing on July 1.

Market makers are exchange members responsible for maintaining liquidity in listed securities by continuously posting buy and sell quotes during the market open session. They must adhere to market-making obligations set by Tadawul, which include requirements such as maximum spread, minimum order size, presence time, and daily traded value.

Among the securities listed on the main index, Morgan Stanley Saudi Arabia will act as a market maker for Riyad Bank, where it will ensure a minimum presence of orders at 80 percent, maintain a size of SR250,000 ($66,660), and adhere to a maximum spread of 0.65 percent, with the lowest value traded of 5 percent.

It will also provide services for Saudi Awwal Bank, ensuring a minimum presence of orders of 80 percent, a minimum order size of SR250,000, a maximum spread of 0.65 percent, and a value traded of at least 5 percent.

Saudi Arabian Mining Co., Astra Industrial Group, and Etihad Etisalat Co. are also among the companies where those requirements will be met, along with Al Rajhi Bank, Saudi Arabian Oil Co., and Saudi Telecom Co.

Additionally, a range of firms will be subject to a minimum order presence of 80 percent, a minimum order size of SR150,000, and a maximum bid-ask spread of 0.65 percent, without any minimum value traded requirement. These include ACWA Power Co., Saudi Electricity Co., and Ades Holding Co.

Morgan Stanley Saudi Arabia will also cover several other securities on the main market, ensuring a minimum presence of orders at 50 percent, maintaining a minimum size of SR75,000, and a maximum spread of 2 percent.

On Nomu, the firm is responsible for guaranteeing a minimum presence of orders at 50 percent, maintaining a minimum size of SR50,000, and adhering to a maximum spread of 5 percent, with no minimum value traded requirements for a range of companies, including, Waja Co., Jana Medical Co., and Purity for Information Technology Co.

Morgan Stanley Saudi Arabia’s participation in market making is expected to contribute to greater liquidity and a more efficient trading environment, reinforcing the development of the country’s capital market.

Tadawul approved a similar move for the investment bank in March, where it served as a market maker for eight separate securities listed on both Saudi indices.

Morgan Stanley entered the Saudi market in 2007 and has since set up its regional headquarters in Riyadh in November as part of a program launched by the Kingdom to provide businesses with a range of incentives, such as a 30-year exemption from corporate income tax, withholding tax on headquarters operations, and access to discounts and support services.


Oil Updates — prices steady as investors watch OPEC+ decision

Oil Updates — prices steady as investors watch OPEC+ decision
Updated 01 July 2025
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Oil Updates — prices steady as investors watch OPEC+ decision

Oil Updates — prices steady as investors watch OPEC+ decision

SINGAPORE: Oil prices steadied on Tuesday after sliding earlier in the session, with the market weighing expectations of an OPEC+ output hike in August in an upcoming meeting.

Brent crude rose 10 cents, or 0.2 percent, to $66.84 a barrel by 8:35 a.m. Saudi time, while US West Texas Intermediate crude inched up 9 cents, or 0.1 percent, to $65.20 a barrel.

“The market is now concerned that the OPEC+ alliance will continue with its accelerated rate of output increases,” ANZ senior commodity strategist Daniel Hynes said in a note.

Four OPEC+ sources told Reuters last week that the group plans to raise output by 411,000 barrels per day in August, following similar hikes in May, June, and July.

If approved, this would bring OPEC+’s total supply increase for the year to 1.78 million bpd, equivalent to more than 1.5 percent of global oil demand. OPEC and its allies including Russia, together known as OPEC+, will meet on July 6.

“These larger supply increases should leave the global oil market well supplied for the remainder of the year,” ING commodities strategists said.

“Expectations for a comfortable oil balance, along with a large amount of OPEC spare production capacity, appear to be comforting the market,” ING added.

Uncertainty about US tariffs and their impact on global growth also kept a lid on oil prices.

US Treasury Secretary Scott Bessent warned that countries could be notified of sharply higher tariffs despite good-faith negotiations as a July 9 deadline approaches, when tariff rates are scheduled to revert from a temporary 10 percent level to President Donald Trump’s suspended rates of 11 percent to 50 percent announced on April 2.

Morgan Stanley expects Brent futures to retrace to around $60 by early next year, with the market being well supplied and geopolitical risk abating following the Israel-Iran de-escalation. It expects an oversupply of 1.3 million bpd in 2026.

A 12-day war that started with Israel targeting Iran’s nuclear facilities on June 13 pushed up Brent prices. They surged above $80 a barrel after the US bombed Iran’s nuclear facilities and then slumped to $67 after Trump announced an Iran-Israel ceasefire.


Closing Bell: Saudi TASI closes lower at 11,163 amid mixed performance

Closing Bell: Saudi TASI closes lower at 11,163 amid mixed performance
Updated 30 June 2025
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Closing Bell: Saudi TASI closes lower at 11,163 amid mixed performance

Closing Bell: Saudi TASI closes lower at 11,163 amid mixed performance
  • MSCI Tadawul 30 Index slipped 0.36% to end at 1,428.86
  • Parallel market Nomu rose 0.34% to finish at 27,341.63

RIYADH: Saudi Arabia’s Tadawul All Share Index fell 0.35 percent to close at 11,163.96 on Monday, weighed by losses in several blue-chip stocks. 

Trading activity remained robust, with turnover reaching SR7.3 billion ($1.9 billion), with the market recording 118 advancers versus 133 decliners. 

The MSCI Tadawul 30 Index slipped 0.36 percent to end at 1,428.86, while the parallel market Nomu rose 0.34 percent to finish at 27,341.63. 

Fawaz Abdulaziz Alhokair Co. led the main market gainers with a 9.96 percent rise to SR24.62. 

National Metal Manufacturing and Casting Co. followed with a 9.29 percent gain, closing at SR16.83. 

Other notable performers included Buruj Cooperative Insurance Co., which advanced 7.40 percent to SR18.00, and The Mediterranean and Gulf Insurance and Reinsurance Co., up 7.16 percent at SR20.06. 

On the downside, Al Maather REIT Fund recorded the steepest decline, falling 3.33 percent to SR9.01. 

Etihad Etisalat Co. dropped 3.10 percent to SR59.30, while MBC Group Co. slipped 2.99 percent to SR35.70. Rasan Information Technology Co. also retreated 2.69 percent to close at SR86.90. 

On the announcement front, ACWA Power Co. released details regarding its planned capital increase through a rights issue. 

The company set the offering price at SR210 per share, with a total of 33,928,570 new shares to be issued. 

Following the offering, ACWA Power’s capital will rise from SR7.33 billion to SR7.66 billion, increasing the total number of shares to 766,490,498. 

The transaction represents 4.63 percent of the issuer’s existing capital and is valued at SR7.12 billion. 

ACWA Power said the proceeds will support its strategy to triple the assets under management by 2030 and strengthen its financial position. 

Eligibility for the rights issue will apply to shareholders registered at the end of the second trading day following the date of an extraordinary general assembly. 

ACWA Power shares closed up 4.07 percent on Monday at SR256.00, with over 1.1 million shares traded.