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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 heads for biggest weekly gain in three months on Trump pressure. Oil was on track for its strongest weekly advance since June, with Brent above USD69/b and WTI over USD65/b, as President Trump stepped up pressure on countries still buying Russian crude. Trump urged Turkish President Erdogan to halt purchases and discussed energy security with Hungary and Slovakia, while reiterating calls for NATO members to cut ties with Russia’s fuel. However, forecasts from the International Energy Agency continues to flag a surplus later this year. That outlook is reinforced by Iraq’s plan to resume Kurdistan oil exports through Turkey’s Ceyhan port this weekend, initially adding 230,000b/d and potentially ramping up to half a million barrels in the future. Despite the weekly jump, crude remains stuck In its narrow trading range as markets balance rising geopolitical tension against expectations of a looming glut.
Gold stays near record on geopolitical tensions and ETF inflows. Gold held just below record levels at around USD3,744/oz, buoyed by safe-haven demand amid elevated geopolitical risks, strong inflows into gold-backed ETFs, and a broader risk-off mood in markets. Prices peaked above USD3,791 earlier in the week and remain supported by warning from European diplomats that NATO could shoot down Russian planes if airspace violation continue, while in wider markets Asian equities retreated after President Trump escalated his trade war with sweeping new tariffs on pharmaceuticals and consumer goods. ETF holdings are now at their highest since 2022, signalling robust investor appetite, while mixed Fed signals continue to shape expectations for future policy, with Governor Bowman suggesting inflation is close enough to target to justify further cuts as labour market weakness deepens.
MIDDLE EAST - CREDIT TRADING
End of day comment – 25 September 2025. Today the new spread realities got cemented with the announcement of a new ADGB 3y/10y deal. The 3y spread was set at T+10bp, the 10y spread was set at T+18bp. The order book is reported at 16.75bn and pricing and tranche sizes are yet to be set. I do not recollect to have seen a credit pricing tighter in my world. But all is relative. ADGB 34s for most of Sept is trading through UST. Away from this rather historic pricing today’s market was driven by the rates move post US numbers. Credit curves steepened on the back of the flattening of the UST curve. IG long end paper still closed about 1/2bp tighter in ADGB and QATAR but took a bit of a breather today in terms of activity. In Quasi sovereign we saw again sellers of 5y paper as the push back against ever tighter spreads continues. That said bonds are still finding a home in willing yield buyers, the likes of ADQABU 29s, 30s or ADNOCM 29s closing about -0.25pt/-1bp. Fins are starting to see bonds coming out, spreads look optically tighter given the short duration nature of fin bonds but the market feels heavy after recent issuance. That said new BKMBOM 30s held just above 100 throughout the day whilst new DHBKQD 31s still has sellers closing -0.25pt/-2bp.
MIDDLE EAST - MACRO / MARKETS
Saudi Arabia freezes Riyadh rent prices for five years. Saudi Crown Prince Mohammed bin Salman has ordered a five-year freeze on residential and commercial rent prices in Riyadh, fixing vacant property rents at their most recent levels. The move, announced by the Saudi Press Agency, follows his pledge to tackle soaring housing cots that have been fuelled by Riyadh’s rapid transformation into a global economic hub. The policy is aimed at rebalancing the real estate sector, reducing costs, encouraging new development, and supporting the Vision 2030 goal of achieving 70% homeownership. To address supply shortages, the government has also increased taxed on undeveloped “white lands” and is advancing major infrastructure projects, including a national park, an entertainment zone with an F1 track, and airport expansion ahead of Expo 2030 and the 2034 FIFA World Cup. Going forward, the freeze is likely to help contain inflationary pressure in the housing market and ease the financial burden on residents, though it will depend on accelerating new housing supply and sustaining investor confidence to keep Riyadh’s property market dynamic while meeting the kingdom’s broader growth targets.
Syria secures USD1.5bn tourism investments and Gulf financial support. Syria took steps to attract fresh capital into its struggling economy by signing USD1.5bn worth of tourism investment contracts, covering the development of hotels, resorts, entertainment centres, and the restoration of historic sites as part of its broader post-war reconstruction and recovery efforts. The move came alongside a pledge from Saudi Arabia and Qatar to provide USD89 million in financial support to Syria’s public sector, earmarked to cover salaries for three months to sustain essential services and ease immediate fiscal pressures. These measures reflect a growing willingness among regional partners and investors to re-engage with Syria’s economy, signalling cautious but notable progress in efforts to stabilise and rebuild after years of conflict.
