US-Iran war could cost Gulf $790 billion by 2030: insurer

Insurer Allianz Trade said Wednesday the US-Iran war could cost Gulf countries $790 billion by 2030, including more than $200 billion in physical damage and projected economic losses over 2026-2030.

The insurer said physical damage across the region was assessed just above $200 billion, mostly in economies dependent on the Strait of Hormuz and especially in energy infrastructure. It said more than 80 energy facilities were hit, mostly in Kuwait, Qatar and Bahrain, and that a third were severely damaged.

The report said the total cost for Gulf countries is set to reach $790 billion, a cumulative gap of 5.9% of GDP compared with the pre-war trend through 2030. It defined the figure as lost output compared with what the region had been forecast to produce before the war.

Allianz Trade said Gulf states are expected to redirect sovereign wealth fund capital toward domestic projects, including around $120 billion in extra domestic investment through 2030, and to raise domestic infrastructure and defence spending to $380 billion-$400 billion. It said that could create about $160 billion in opportunities for private and foreign investors.

The report linked the losses to the war triggered after the United States and Israel attacked Iran on February 28, and to Iran's retaliatory restrictions on shipping in the Strait of Hormuz and strikes on civilian infrastructure in US-allied Gulf countries.

The IMF expects Saudi Arabia to end the year with a 3.3% GDP contraction, five percentage points below its July forecast. Saudi Aramco announced a 34.6% rise in third-quarter net profit last week, as higher oil prices supported earnings.