I spent a lovely night at the Piano Man listening to bits and bobs about financial planning from the brilliant Anshuman Sharma. And now I’ve returned home, ready to take the plunge into the crisis ravaging the Gulf.
Everything is going south for the Saudi prince, Mohammed Bin Salman. The Economist cited this year as his annus horribilis. He wants to best the Iran-backed Houthis in Yemen, boost the economy and count on Trump. So far, he has fared on neither front. The IMF revised growth estimates for 2026 from 4% to 3.3%. The Houthis are tough nuts. Either the kingdom will have to send ground troops, thus prolonging a war; ensue air strikes that are unlikely to succeed; or secure a deal with Houthis’ that will further cement their rule in Yemen. Diplomats in Riyadh scoff at the argument that these could be trying times for MBS, reminding the interlocutors how dire the situation was seven to eight years ago, when he was appointed to the throne.
Meanwhile in the other part of the Gulf, things are looking relatively brighter. The UAE’s governance structure, with its bizarre array of princes, emirs, presidents, vice-presidents has always confused me. The UAE is a federation of seven hereditary monarchies; it has a federal government. Each emirate has an emir or a ruler. The seven rulers form the Federal Supreme Council. The Council elects the President and the Vice President. The same person could be an emir, a prince in a royal family and the President or the Vice President of the UAE. For example, Sheikh Mohamed bin Zayed Al Nahyan (MBZ) is the Ruler of Abu Dhabi, the country’s capital, and also the head of state (President), the most important political in the country. Sheikh Mohammed bin Rashid Al Maktoum is the Ruler of Dubai and holds the position of Vice-President and Prime Minister. He is from a different royal family. Sheikh Mansour bin Zayed Al Nayan, popularly known as the owner of Manchester City Football Club, is the other Vice-President. He was not appointed via the council route; the President nominated him and he was appointed after the Council’s approval. This is mandated by Article 51 of the UAE Constitution. Sheikh Mansour is the brother of MBZ.
Not all is well between Saudi and the Emirates though. The tiff has been further exacerbated by the personal differences between MBS and MBZ. Once they shared a sibling-like and mentor-protege relationship. MBS’ palace coup, back in 2017, was supported by MBZ and the Emiratis worked to boost his image in America. But later cracks appeared in their relationship when the Emiratis established ties with Israel in 2020 while the Saudis did not, when they argued over trade barriers, and when they broadly began supporting opposing sides in regional conflicts.
The most pronounced of the disagreements was regarding oil. The Saudis wanted strict production caps to be imposed by the OPEC to keep the oil prices high, preferably $90 per barrel to balance out its budget and pay for the costly schemes the government has been implementing to diversify the economy. The UAE, on the other hand, would rather sell more oil now, at modest rates of $50 per barrel lest its reserves become worthless in the future. This spat eventually culminated in the UAE leaving the OPEC earlier this year.
The diversification efforts in Riyadh has brought it in competition with the UAE. But the UAE has a better edge on this front since it had begun the exercise long before.
The regional feud has sputtered into the conflicts surrounding the Gulf. Despite their similar geopolitical interest — such as averting the war in Iran fearing that they would get caught in the crossfire — the two countries sometimes support opposing sides, entrenching the bloody wars. The Economist says, “Not even the existential threat posed by the war in Iran, which has throttled their oil exports and shredded America’s security umbrella has convinced these two countries to put their differences aside.” The 250mn people inhabiting Yemen, Sudan and Ethiopia are the victims. In a show of support and untimely adventurism, Egypt, Israel and Turkey have joined the fray. The wars in the three countries predate the Gulf monarchies’ involvement, but their continuing animosity isn’t helping calm things either.
The Saudis support the SAF and the Emiratis (covertly) support the RSF in Sudan. Within the anti-Houthi camp, the Saudis back Islah, an offshoot of the Muslim brotherhood, while the Emiratis has aligned itself with the separatists. Even worth, Abiy Ahmed is finding support for his worst instincts — such as invading Eritrea to secure port access (areas of which were part of Ethiopia until 1993) — in UAE, while Eritrea is trying to balance the scales by securing the KSA’s backing. The ground is fast shifting in Somalia too, with the UAE finding itself close to Somaliland, the breakaway province and the national government courting Saudi Arabia “as a counterweight.”
But this pattern of being at loggerheads in every regional conflict suggests that the wars stand a considerable chance of ending if these Gulf hegemons withdraw both their financial and military support.
On that note, we wrap up this week’s short write-up. Adieu!
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