DUBAI, United Arab Emirates — Middle East stock markets tumbled Monday as they struggled with the dual hit of and a sharp decline in oil prices, squeezing energy-producing nations that rely on those sales to power their economies and government spending.
Benchmark Brent crude is down by nearly 15% over the last five days of trading, with a barrel of oil costing just over $63. That’s down nearly 30% from a year ago, when a barrel cost over $90.
That cost per barrel is far lower than the estimated break-even price for Saudi Arabia and most other countries producing energy in the Middle East. That’s coupled with the new tariffs, which saw the Gulf Cooperation Council states of Bahrain, Kuwait, Oman, Qatar, Saudi Arabia and the United Arab Emirates hit with 10% tariffs. Other Mideast nations face higher tariffs, like Iraq at 39% and Syria at 41%.
“With these measures and the expected retaliatory measures that could be adopted by other countries, the stability and predictability of international trade could be undermined,” the accounting firm PwC said in an advisory to its Mideast clients.
Losses sweep region
The Dubai Financial Market exchange fell nearly 6% as it opened for the week, with market leader Emaar Properties down nearly 9%. The Abu Dhabi Securities Exchange fell 4%.
Markets that opened Sunday saw losses as well. Saudi Arabia’s Tadawul stock exchange fell over 6% in trading. The giant of the exchange, Saudi Arabia’s state-owned oil company Aramco, fell over 5% on its own, wiping away billions in market capitalization for the world’s sixth-most-valuable company.
The drop , whose shares also power Crown Prince Mohammed bin Salman’s expansive plans to reshape the kingdom’s economy, ties directly back to the overall price of oil. The OPEC+ oil cartel already has planned to boost production as well, further forcing prices down.
“OPEC+ has shifted its market management strategy from a steady incremental increase in output to monthly announced targets, bringing forward higher output levels for May this year,” an analysis published Monday by the state-majority-owned Emirates NBD Bank of Dubai said. “That will leave oil markets grasping with additional volatility as they assess the negative impact on global trade of the tariffs announced by the Trump administration.”
Pakistan also struggles
The Pakistan Stock Exchange fell rapidly Monday, with Islamabad facing 29% tariffs from the U.S. The exchange suspended trading for an hour after a 5% drop in its main KSE-30 index.
“We may face this situation until the uncertainty ends at the global market,” said Mohammed Sohail, the chief executive at Topline Securities.
Pakistan’s Finance Minister Muhammad Aurangzeb said over the weekend that Islamabad will send a delegation to the United States soon to negotiate. The U.S. imports around $5 billion worth of textiles and other products from Pakistan, which heavily relies on loans from the International Monetary Fund and others.
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Associated Press writer Munir Ahmed in Islamabad contributed to this report.
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