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Ramped-up oil production and diversification efforts will help most Gulf economies grow faster this year than they did in 2024, a Reuters poll of economists suggested.
Despite deep cuts to oil output since late 2022, energy prices have largely stayed subdued as heightened geopolitical tensions and US trade uncertainties have affected oil demand, hurting the Organisation of the Petroleum Exporting Countries (Opec) revenues.
A separate poll expected Brent crude to average $67.86 per barrel in 2025. It has largely traded around $70 so far this year.
Opec countries have ramped up oil production since April to regain market share from rival producers such as the United States and are encouraging tourism to diversify revenue streams.
Saudi Arabia’s gross domestic product was expected to grow 3.8 per cent this year, the poll of 20 economists taken from July 15-28 showed. That is nearly three times the 1.3pc the economy expanded in 2024.
“We had always anticipated that Opec+ would be returning more barrels to the market this year than initially indicated, but the pace at which it is proceeding has exceeded even our expectations,” Daniel Richards, Mena economist at Emirates NBD, said.
“It is clear that the (Saudi) government remains committed to the diversification efforts and ... the value of project spending that has already been implemented should be sufficient to maintain a robust pace of growth over the next several years.”
The UAE was expected to outperform its peers to grow 4.8pc in 2025 and 4.6pc in 2026, an upgrade from 4.5pc and 4.2pc in an April poll.
Qatar was predicted to grow 2.7pc this year and accelerate to 5.4pc in 2026 – its fastest expansion in 13 years – as its massive liquified natural gas (LNG) expansion project starts next year. Both Qatar and the UAE are also reducing dependence on oil by becoming tourism destinations.
“Qatar benefits from resilient gas revenues ... Both countries (Qatar and UAE) are well positioned due to strong buffers and ongoing non-oil diversification,” Bader Al Sarraf, research analyst at Standard Chartered, said.
While Middle East economies are largely shielded from US tariff threats, other countries are under pressure to reach deals with President Donald Trump before they are slapped with heavy duties on August 1.
Inflation across the Gulf was expected to remain benign.
Poll medians showed inflation across the region holding within a 1.0pc-2.5pc range in 2025. Forecasts for the UAE and Saudi Arabia were pegged at 2.0pc with Qatar at 1.5pc.
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