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Middle East Daily
SOOJIN KIM
Research Analyst
DIFC Branch – Dubai
T: +44(4)387 5031
E: soojin.kim@ae.mufg.jp
MUFG Bank, Ltd. and MUFG Securities plc
A member of MUFG, a global financial group
Middle East Daily
COMMODITIES / ENERGY
Oil steadies as market weighs Aramco price cut and US stock build. Oil prices stabilised after two sessions of losses, with Brent holding above USD63/b and WTI trading below USD60/b, as traders balanced bearish supply signals against signs of resilient demand. Saudi Aramco’s decision to cut its crude prices to Asia, a move largely anticipated by the market, added to sentiment that demand growth in the region may be softening. Meanwhile, US crude inventories jumped by 5.2 million barrels in the last week of October, the largest increase since July, underscoring a potential near-term oversupply. Despite this, a sharp 5 million barrel drop in US gasoline stocks to a three-year low helped cushion downside pressure. Overall, Brent remains down nearly 15% YTD as rising global production continues to weigh on prices, even as geopolitical disruptions and sanctions on Russian energy firms offer intermittent support.
Gold holds near USD3,980/oz as traders weigh US labour data and Fed policy outlook. Gold steadies after its sharpest rise in a week, trading just above USD3,980/oz, as investors evaluated the impact of US labour data on the Fed’s policy path. Private sector payrolls rose 42,000 in October, a modest rebound that eased fears of a deeper slowdown while reinforcing signs of cooling demand for labour. Fed governor Stephen Miran welcomed the improvement but maintained that rates should be lowered more aggressively to support growth. The precious metal has surged over 50% this year, reaching record highs in October, driven by rate cuts, strong central bank buying, and robust inflows into gold-backed ETFs. With the Fed’s final 2025 meeting approaching and the US government shutdown delaying key data, traders face heightened uncertainty over the economic outlook and the pact of further easing.
MIDDLE EAST - CREDIT TRADING
End of day comment – 05 November 2025. Another big move in UST markets defined today’s trading. Post ADP/ISM though the market saw more selling interest from RM. Spreads near the YTD tights cannot absorb rates move like today and cash prices adjusted lower. Spreads broadly closing -2/-3bp but the market has bonds to sell especially with new issues continuing to print. In the IG space QATAR was again more active than ADGB on the back of the new issuance, new 35s sukuk outperformed closing -0.20pt/-4bp. Other IG curves were 0.25/0.5pt lower and 2/3bp tighter on the day with long end bonds again trading a touch firmer than belly bonds. Quasi sovgn saw most activity in MUBAUH where late selling in long end bonds put a bit a brake on the relative outperformance to the belly and other names, 49s closing -0.5pt/-2bp. In corps seeing end of day selling in DPWDU 33s and 35s which are closing -0.375pt/-2bp. Fins were again inactive, didn't see many requests in new SIB and closing it around reoffer. The rates move is starting to bite. 10y yields are now nearly 20bp wider post FED and whilst higher yields bring yield buyers out, new issuance and tight spreads keep flows tilted to selling of risk.
MIDDLE EAST - MACRO / MARKETS
UAE launches USD46.3bn transport investment plan. The UAE unveiled an ambitious AED17bn (USD46.3bn) national investment program aimed at expanding and modernizing its road and transport infrastructure by 2030. Announced by Energy and Infrastructure Minister Suhail Al Mazrouei, the plan includes widening federal highways, developing high-speed rail links, and improving public-transport networks, with capacity expected to rise by 73% over the next five years. The initiative, part of the “we the UAE 2031” strategy, is designed to ease congestion, enhance inter-emirate connectivity, and support urban expansion. Economically, it underscores the government’s commitment to public investment led growth, providing momentum for logistics, construction, and real-estate sectors while reinforcing the UAE’s long-term development and diversification goals.
Qatar’s USD3.5bn investment boosts Egypt’s North coast development. Qatar Diar, a subsidiary of Qatar sovereign wealth fund, will invest USD3.5bn in a major tourism and real estate project along Egypt’s Mediterranean coastline, marking another wave of Gulf support for Egypt’s economic recovery. The project, spanning 7.2km in the Alam AL-Roum area, will feature luxury resorts, golf courses, and other real estate developments aimed at attracting regional and international visitors. The company also committed an additional USD26bn in-kind investment, with details yet to be disclosed. The announcement follows Egypt’s earlier USD35bn deal with the UAE to develop Ras El-Hekma and comes as the country works to attract more foreign direct investment and advance IMF-backed reforms under its USD8bn loan program. Following the news, Egyptian dollar bonds rallied, signalling renewed investor confidence as Egypt targets 30 million annual tourists by 2031 and continues efforts to privatise state assets and stabilise foreign-currency reserves.
