Weekly GCC news to 6 Dec: OPEC+ and Syria

(I’ll be at the Doha Forum and then Abu Dhabi Finance Week, do get in touch if you’d like to connect)

• OPEC+ reduced 2025 taper plans by 1m b/d and extended cuts into 2026 [see (1) below and graph].
• Participating GCC states will increase oil output in 2025 by only a third of what was previously planned.
• Gulf leaders met in Kuwait and called for a ceasefire in Gaza. MBS and MBZ met in Abu Dhabi.
• PMIs surged in KSA (to 59) and Kuwait (to 56) but held steady in the UAE (54) and Qatar (53).
• The Riyadh Metro finally opened and attracted flocks of Saudis seeking to escape congestion.
• Macron visited Saudi Arabia; deals included solar contracts and $10bn in export credit for PIF.
• The UAE’s fiscal surplus rose to 5.8% of GDP in Q3 and was 6.4% YTD.
• The IMF published its UAE Article IV report and sees upside risks to growth.
• Knight Frank thinks Dubai residential real estate could rise another 8% in 2025, on top of 20% this year.
• Adnoc signed a 1m t/yr LNG deal with Petronas; QatarEnergy signed a 3m t/yr deal with Shell.
• Kuwait continued its campaign of revoking citizenships, ejecting over 9,000 people so far.
• OQ Base Industries IPO priced at the top of its range, and OQ is considering listing more units.
• Oman launched its first rocket into space from Duqm spaceport.
• Bahrain’s foreign reserves dropped back sharply in October, down -17% m/m.
• Lebanon’s ceasefire has been shaky. Qatar has revived mediation for a Gaza ceasefire.
• Syrian rebels captured Aleppo and Hama, the second and fourth largest cities [see (2) below].

These headlines are taken from a 4,900-word report from my economic research service with GlobalSource Partners, a leading source of independent emerging market intelligence. Click on any report to get guest access and contact me or GlobalSource’s sales team for more information about the service, which also includes the most extensive comparative GCC economic Databank (updated weekly) and direct analytical support. Clients include banks, asset managers and governments spanning the GCC, Asia, Europe and the Americas.

Here are two brief samples from the report:

(1) OPEC+ slows its taper yet again

• As was widely expected, The 2.2m b/d of voluntary cuts introduced by eight countries (the “V8”) in January will remain in place, delaying the taper for a third time, this time for three months, through Q1 (OPEC+).
• Also, the taper will be slower, and so will only add an average of 0.5m b/d in 2025, a third of the previous plan to add 1.5m.
• OPEC+ cuts will continue for a 10th year, with the rest of the tapering spread over the first nine months of 2026. This will mean an additional 1.4m b/d on average over 2026. It also means that the 11 smaller OPEC+ members who are not participating in the V8 voluntary cuts will at least maintain their current production caps for another year.
• The phase-in of the UAE’s additional allocation of 300k b/d, on account of its increased capacity, will also be spread over two years.
• GCC production will grow by much less than previously planned in 2025, slowing GDP growth as well. The UAE will grow by on 3.3% on average (vs 10.4% previously planned), Saudi Arabia by 2.3% (vs 6.9%) and Kuwait and Oman by 1.2% (vs 3.5%) (see graph above).
• The deeper cuts will add to the strain on the cartel at its weak points, which include Iraq, Kazakhstan and the UAE, as well as some smaller members. Notably, Iran’s delegate to OPEC, Afshin Javan, published an article (that was quickly deleted) arguing that OPEC+ policy has created a supply glut: (BB, WSJ).
• Although some commodity analysts said the OPEC+ action was a positive surprise, the oil market seems unimpressed. Brent crude, which had rallied a little to nearly $74 ahead of the meeting, has since fallen back to $71, a three-week low (Rt).

(2) Syrian rebels capture Aleppo and Hama

• A 4-year stalemate in the civil war was broken dramatically as Islamist rebels HTS (“Organization for the Liberation of the Levant”) advanced out of Idlob province and captured Aleppo, Syria’s second-largest city, on Saturday and then Hama, its fourth city, on Thursday (Jaz).
• The collapse of government forces was a surprise to almost everyone. It was a mixture of surprisingly good organization by HTS as well as a reduced presence by Assad’s allies, Hizbollah, Iran and Russia, who have been distracted by other conflicts and the decay of the Syrian military and state (including damage from Israeli airstrikes).
• HTS is advancing south to Homs, the third city, which was a hotbed of the original uprising in 2011. Russia destroyed a bridge over the River Orontes to try and slow them but it doesn't seem to have worked because there are reports today that some of their forces are south of the river and nearing Homs. If they capture the city then they could cut off the coastal provinces, Assad's heartland of support, from Damascus. Liveuamap seems to be doing a fairly good job of tracking the fluid frontlines.
• The Kurds, who established an autonomous statelet ("Rojava") in the northeast and north after defeating Islamic State, are facing major losses. HTS ordered the Kurdish-led SDF to leave northern Aleppo. Further north, the Turkish-backed SNA has been fighting the SDF in Tal Rifaat, which housed many of the Kurds who had previously been displaced by the SNA’s capture of the Afrin in 2018 when Trump lifted US protection from the Kurds (F24).
• What next? There are signs of a revival in long-suppressed rebellions in other parts of the country, notably in the south in Deraa and the Druze community in Suwayda. This conflict could play out like the Taliban’s lightning advance to Kabul (Israeli intelligence officials reportedly think that Damascus could fall, Ax) or else shift back into years more of grueling flighting. In the north, the SNA could try to capture Manbij, the last major Kurdish-controlled city west of the Euphrates.
• Meanwhile, HTS (designated as a terrorist group by the US, UN and Turkey) is trying to present itself as a competent and tolerant administration in Aleppo. It has pledged to protect members of the Assad security forces from retribution if they defect and some members reportedly attended church services on Sunday to show acceptance of the sizable Christian minority in Aleppo (Rt). Whether this approach is believed remains to be seen as HTS, which formed in 2017 from a merger of Islamist rebel factions, includes formerly jihadist-toned elements such as al-Nusra Front, which was founded by HTS’s leader, Abu Mohammed al-Jolani (Rt).
• Syria is a wonderful country that I regularly visited in 2001-10 and its people deserve an end to conflict, good governance and human rights, and a chance for millions of refugees to return home safely.

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