Latest news with #KhalidAlMansour
Daily Tribune
2 days ago
- Politics
- Daily Tribune
Bahrainis stranded in Iraq begin journey home as airspace closes
Bahrainis stranded in Iraq have begun making their way out by road after the Iraqi government shut down its airspace in the wake of Israeli airstrikes on Iranian targets. The Iraqi Ministry of Transport confirmed the move, saying, 'All flights were halted and airspace sealed off,' describing it as a precautionary measure. The closure applies to all airports in Iraq and will remain in effect until further notice. Bahrainis safe Bahrain's ambassador to Iraq, Khalid Al Mansour, said all Bahrainis in the country are safe. The embassy, he added, is maintaining close contact with Bahraini religious tour groups. While a few people remain, many have already left Iraq, either by flying out on Gulf Air before the closures or by crossing the border by land. Similar repatriation efforts have been launched by other Gulf states as tensions across the region escalate. Flights cancelled Airlines across the Middle East have begun cancelling flights or diverting routes, citing multiple airspace closures: • Emirates, the region's largest airline, said it had cancelled flights to and from Iraq, Jordan, Lebanon and Iran, with several Friday services and a Tehran-bound flight on Saturday listed as cancelled. • Qatar Airways, another major regional carrier, said it had 'temporarily cancelled flights to Iran and Iraq due to the current situation'. • UAE airports also reported disruptions. Dubai Airport warned via social media that 'some flights at @ DXB and DWC – Al Maktoum International have been cancelled or delayed' due to airspace restrictions over Iran and Syria. • AbuDhabi Airport said 'Flight disruptions are expected through today (Friday)' as a result of the regional escalation. • Kuwait's civil aviation authority reported that 'some flights at Kuwait International Airport have been diverted, cancelled, or rescheduled.' Earlier Friday, Jordan announced a full airspace closure and suspended flights following the Israeli strikes. Jordan's military said it had intercepted drones and missiles that violated its airspace after Iran vowed an aggressive response to what it called a 'declaration of war' by Israel. Authorities are urging citizens in affected areas to remain in contact with their embassies and check with airlines for travel updates.
Khaleej Times
15-04-2025
- Business
- Khaleej Times
GCC banks brace for indirect fallout from global tariff war
The escalating tariff war will have limited direct impact on GCC banks, but the indirect effects of falling oil prices and weaker global economic activity could pose significant challenges, a new report from Fitch Ratings suggests. As trade tensions escalate, particularly between the US and China, the ripple effects on oil demand and government spending in the GCC—a region heavily reliant on hydrocarbon revenues — are raising concerns among analysts and industry experts. Fitch Ratings notes that GCC exports to the US are predominantly hydrocarbons, which are exempt from tariffs. Non-hydrocarbon exports, facing a 10 per cent tariff (or 25 per cent for aluminium and steel), constitute a small fraction of trade, insulating banks from direct tariff-related shocks. However, the real threat lies in declining oil prices and reduced global demand, which could curb government spending — a critical driver of banking activity in the GCC. 'Lower oil prices and weaker global economic activity could lead to reduced government spending, which strongly affects bank operating conditions in most GCC countries,' Fitch stated. In March 2025, Fitch downgraded its global GDP growth forecast to 2.3 per cent for 2025 and 2.2 per cent for 2026, warning of risks skewed toward a sharper slowdown. This follows similar revisions by the International Monetary Fund, which in April 2025 cut its global growth outlook to 2.4 per cent for 2025, citing trade disruptions. A weaker global economy could depress commodity prices, particularly for hydrocarbons, which account for 60-90 per cent of government revenues across GCC nations, according to World Bank data. Fitch emphasised that market balance and oil prices hinge on global economic performance and Opec+ supply decisions, with the group holding over 6 million barrels per day in spare capacity as of January 2025. Before tariffs intensified, Fitch projected non-oil GDP growth for the GCC at over 3.5 per cent for 2025 and 2026. However, a sustained drop in oil prices could slash budget revenues, stifling non-oil economic activity and government spending. This would weaken lending growth prospects for GCC banks, which Fitch had forecasted in its Middle East Banks Outlook 2025 to remain near 2024 levels. Brent crude, trading at $64.72 per barrel on April 14, 2025, per Reuters, is already under pressure, with Goldman Sachs predicting a decline to $58 by 2026 if trade wars persist. Corporate borrowers in the GCC could also face headwinds. Tariffs may raise operating costs and inflation, squeezing profitability and cash flow, particularly in trade-exposed sectors. Uncertainty over interest rates, with potential delays in US Federal Reserve rate cuts, could further increase debt costs, dampening credit demand. 'If corporates struggle, we could see a rise in non-performing loans, putting pressure on bank balance sheets,' said Dr. Khalid Al Mansour, an economist at the Gulf Research Centre. This could elevate credit risk, challenging banks' asset quality. Despite these risks, GCC banks are relatively resilient. Many have bolstered capital buffers in recent years, supported by strong earnings from higher oil prices and favorable interest rates. Liquidity remains robust, and economic activity has been buoyant, particularly in Saudi Arabia and the UAE. 'GCC banks are well-positioned to weather moderate shocks, but a prolonged oil price slump could test even the strongest institutions,' noted a banking analyst. Bahrain's banking sector is the most vulnerable, with Fitch assigning it a 'b+'/negative operating environment score, constrained by the country's B+/Negative sovereign rating. Bahrain's high debt burden and reliance on an elevated break-even oil price — estimated at $95 per barrel by the IMF — make it susceptible to oil market volatility. In contrast, Saudi Arabia (A+/Stable), the UAE (AA-/Stable), Qatar (AA/Stable), and Kuwait (AA-/Stable) boast stronger sovereign credit profiles and reserves, enabling them to sustain spending. Oman (BB+/Positive) is an outlier with a positive outlook, reflecting recent fiscal reforms. The UAE and Saudi Arabia lead with the highest bank operating environment scores ('bbb+'/stable), followed by Qatar and Kuwait ('bbb'/stable). 'The diversification efforts in Saudi Arabia and the UAE provide a buffer, but oil remains the backbone of their economies,' Al Mansour added. As global trade tensions mount, GCC banks must navigate a complex landscape where oil prices, not tariffs, will dictate their fortunes.
