Gulf

1. Iran rejects Hormuz plan
2. The UAE hedges with Iran
3. Saudi lobbying to host G20
4. Inflation bites Saudi bread
5. Emirates airline takes crypto

35 billion Saudi trees may not be enough to stop the heat.

Hormuz plan rejected as fighting escalates

After a brief lull, the conflict is heating up. The US and Saudi Arabia bombed Iran-backed militias in Iraq, alleging they were behind recent drone strikes on Saudi oil facilities; Iran said it had hit three tankers in the Strait of Hormuz and targeted a US base in Jordan. Tehran also rejected an Omani proposal for joint management of the Strait of Hormuz.

Both Iran and the US are preparing for further combat. Iran’s defense minister said his country’s military industrial sector was “more active than before,” while Washington has been sending more forces to the Gulf. With an eye to the longer term, the US and the UAE are set to launch a bilateral task force to develop military AI applications.

At least the risk of the conflict spreading beyond the region appears to have been averted, after Ukraine’s foreign minister said he had “a frank conversation” with his Iranian counterpart. Tehran had threatened retaliation after Kyiv’s forces struck an Iranian merchant ship in the Caspian Sea over the weekend.

UAE cautiously engages with Iran

Whether by carrot or stick — and there’s still no definitive reporting on which — the animosity between Iran and the UAE has been easing. The Emirates bore the vast majority of Tehran’s attacks in the first weeks of the war, but since April 29 that has shrunk to 17% of Iranian strikes. The shift has coincided with an effort to cool tensions, with the UAE seeking to move “from hostility to détente with Tehran,” the Financial Times reported.

Direct flights and commercial shipping between the UAE and Iran have resumed. But this is not a new alliance in the making. The UAE is reopening economic and diplomatic channels with Iran while also deepening defense ties with Israel and the US. The strategy, which also includes building new supply chains and fortifying infrastructure, has an overarching objective: “resilience,” a term the FT noted is the “buzzword” in the Emirates these days.

— Mohammed Sergie

Saudi lobbies to host G20 in 2030

Saudi Arabia wants to host the G20 leaders’ summit in 2030 and has started lobbying to rally support for its bid, according to people familiar with the matter. The meeting would be part of a series of events intended to coincide with the culmination of its Vision 2030 economic diversification drive under Crown Prince Mohammed bin Salman, raise the kingdom’s profile internationally, and position itself as a global force.

If Riyadh gets its wish, it would mark the first time the G20 leaders’ summit is held in Saudi Arabia, after the kingdom’s chairing of the G20 in 2020 was switched to a virtual gathering because of the COVID-19 pandemic. Saudi Arabia already plans to host the 2030 World Expo as part of efforts to showcase its transformation.

— Matthew Martin

Saudi bread ritual outgrows the riyal

Ask anyone in Saudi Arabia the price of tamees — the flatbread on almost every weekend breakfast table — and the answer is one riyal ($0.27). Or, at least, it was.

Friday afternoons for many Saudis often mean queuing for the cheap, calorie-rich, clay-oven bread. Lines spill down the block after prayer, with laborers and millionaires alike waiting to pair it with two-riyal fava beans from the fawal, or cafeteria, beside the bakery. Bakers spent years holding the symbolic one-riyal line for tamees, but rising costs have finally outrun them: Most now charge up to two riyals, Al-Eqtisadiah found.

Until now, bakers have used premium cheese, za’atar, and ghee versions of the bread to subsidize the price of the plain ones. But even that workaround no longer holds. The state gas company raised cylinder prices 41% this month, and a bakery can burn through five cylinders a day. An old folk verse prices a simple life at two riyals for beans and one for bread — only half of that tune still rings true.

— Manal Albarakati

Emirates adds crypto payment option

Travelers on Emirates, the world’s biggest long-haul carrier, can now use crypto to pay for tickets. The option is currently only available to UAE residents, with transactions settled in dirhams and processed through Crypto.com wallets. Expanding payment options aligns with Dubai’s goal of making 90% of financial transactions digital by the end of 2026 and reinforcing its lead as the Gulf’s crypto hub.

While enthusiasm for Bitcoin has cooled after it lost nearly half its value since October, interest in blockchain, digital assets, and tokenization is growing across the region. Abu Dhabi has launched stablecoins, and Saudi Arabia — which has avoided speculative areas of crypto trading — is focusing on tokenizing real-world assets such as property and infrastructure.

Deals

• Saudi billionaire Prince Alwaleed bin Talal bought a 5% stake worth around $130 million in electric carmaker Lucid, whose shares slumped after a report, later denied, that it was considering bankruptcy. Lucid is controlled by Saudi Arabia’s Public Investment Fund, which also has a stake in Alwaleed’s investment firm Kingdom Holding.

Finance

• Sixth Street, the San Francisco investment firm with more than $135 billion in assets under management, is moving forward with a previously announced plan of opening an office in Abu Dhabi. The firm hired former Goldman Sachs executive Ahmed Ismail as its first executive to be based in the region.

Food & Agriculture

• Fertiglobe, the region’s top maker of fertilizer, reported second-quarter revenue of $1.1 billion, 92% higher than the same period last year.

Stocks

• Mobily, the Saudi telecom partly owned by the UAE’s e&, confirmed a Semafor scoop that it is in preliminary talks with TAWAL, the Saudi sovereign wealth fund-controlled tower company, to sell more than 10,000 telecom towers. Mobily’s stock rose about 5% after the report.

Tech

• The Abu Dhabi Judicial Department will implement what it bills as the world’s first fully integrated AI judicial platform to support case analysis, legal research, and decision-drafting across the emirate’s courts. Judges will retain final authority over rulings.

A Saudi-led group has pledged to plant 35 billion trees across the Middle East — an idea surely everyone can get behind. But what happens when extreme heat makes such projects essentially redundant?

That’s the question posed by Haya Alhusainan of the LSE Middle East Centre. Climate adaptation research has largely searched for measures that cut risk: heat warning systems, urban greening, better building design. They’re essential, she writes, but “often evaluated as though their effectiveness remains unchanged as climate risks intensify.”

Many of the Gulf’s solutions were designed for periods of blistering temperatures, not expecting those temperatures to become the norm. In Kuwait, for example, summer nights are warming faster than summer days, cutting the overnight cooling period that people and infrastructure need to function. Extreme heat therefore “evolves into a persistent environmental condition,” Alhusainan says, and strategies need to evolve. Because if the water runs out due to extreme heat, it won’t be much good having billions more trees.

The graphic in item 2 in the July 28 briefing, “Saudi crude’s costly journey to Asia,” incorrectly stated the estimated additional cost of shipping Saudi crude to Asia via the Suez Canal as $2.5 billion. The correct figure is $2.5 million.