09/03/2026
Why is Iran hitting the Gulf states?
Firstly, every Gulf state except for Oman has a US military base on its territory, and even Oman allows its airfields and ports to be used by the US military to use its airfields and ports. So that alone makes those locations legitimate military targets.
But there is more to this...
The US mainland is well beyond the reach of Iran's weapons, but striking the energy infrastructure, export terminals, pipelines, and storage facilities of the most consequential oil and gas producers in the world will create shock waves through the global economy.
The oil price is expected to spike significantly over the coming days. This is intended to impose a cost on the entire international community in the hope some "allies" will pressure Trump into winding his attacks up.
But perhaps most crucially, these attacks, even the superficial ones, erode the image of the Gulf states as bastions of stability and security in a volatile region. For Dubai in particular, the sight of Shahed drones floating past the Burj Khalifa sent chills throughout the expat community, with governments around the world working to repatriate stranded foreign workers with escorted flights and even buses across Saudi Arabia.
This has been all the more difficult as three of the world's busiest airports were forced to shut down. Dubai, Abu Dhabi, and Doha built their economies around becoming global transit hubs between Europe, Asia, and Africa. The aviation sector (airlines, airports, and the tourism it supports) is estimated to contribute around 30% of Dubai’s GDP. Anything that threatens the perception that the Gulf as a safe and stable transit point has the potential to devastate one of the pillars of their long-term economic strategies.
Perhaps under appreciated is the fact that as much as 70% of Dubai's luxury property market is owned by foreigners. To a large extent, Dubai works as a global capital holding yard, where shady shell companies and organised crime can move billions of dollars and easily transfer it into property or gold with very few questions asked.
Some academic studies have suggested that as much of 19% of the UAE's GDP was linked to money laundering, but even criminals and corrupt foreign politicians want their ill-gotten gains to be safe. If confidence in the Dubai property market begins to tremble, the city could face a similar property bubble burst to that experienced in 2008.
Every day this war drags on, the Gulf States risk being pulled towards a financial crisis that could take years to recover from, and yet Iran still has plenty more targets it could pursue if it really wanted to do damage. So, what are the Iranians attempting to achieve?
To some extent, it's a shot across the bow of its traditional Sunni adversaries, to remind them of the consequence of conflict should they choose to participate in the offensive action. But I also suspect that the Iranians believe the monarchs of the Gulf have more influence over Trump than any Western "ally".
Last year, a UAE-linked investment fund bought about $100 million of tokens issued by Trump's personal crypto currency project, World Liberty Financial, the Qatari's bought him a 747 jet, while the Saudis are building not one, but two Trump Towers. These are just the payments we know about (perhaps a good time to remind you that Trump's net worth has increased from $4.3 billion to $7.3 billion since taking office, almost entirely from untraceable crypto).
They have good reason to believe that if Trump's paying customers begin to feel the pinch, they might have the influence necessary to bring on a ceasefire faster than the UN, international community, or even his own constituents... and they might be right.