Middle East 1

SOOJIN KIM Analyst Middle East Daily DIFC Branch – Dubai T: E: 27 July 2026

MUFG Bank, Ltd. and MUFG COMMODITIES / ENERGY Securities plc A member of MUFG, a global financial group Oil retreat as US pauses strikes on Iran. Brent crude fell more than 7% before recovering to trade above USD93/b, while WTI also declined, after the US paused military strikes against Iran, raising hopes for a temporary de-escalation in the Middle East conflict. The pullback came despite Houthi claims of attacks on Saudi energy facilities in Yanbu and Jizan, although the incidents were not confirmed by Saudi authorities. Shipping activity through both the Strait of Hormuz and Bab el-Mandeb remained well below normal, highlighting continued disruption to regional energy trade, while Ukraine drone attacks also temporarily halted oil loadings at Russia’s Novorossiysk export terminal. Although the pause in US military action has eased immediate supply concerns, constrained maritime traffic across key export routes suggests geopolitical risk remains elevated, leaving oil prices vulnerable to renewed volatility if hostilities escalate again.

Gold rebounds as Middle East tensions ease. Gold rose as much as 1.6% to above USD4,100/oz after the US paused military strikes against Iran and Iran signalled a willingness to pursue diplomatic talks, easing concerns over oil supply disruptions and inflation. Brent crude fell more than 7% at the start of trading before recovering, as the pause in hostilities outweighed Houthi claims of attacks on Saudi energy facilities in Yanbu and Jizan. Gold has continued to find support around the USD4,000/oz level through sustained dip-buying, although it remains more than 20% below its February record high. The easing in geopolitical tensions has reduced inflation concerns and could lessen pressure on the Fed to tighten policy further, providing near-term support for gold ahead of this week’s closely watched Fed meeting.

CAPE OF GOOD HOPE TANKER FLOW (W>E) ROSE SHARPLY

02-Feb 09-Feb 16-Feb 23-Feb 02-Mar 09-Mar 16-Mar 23-Mar 30-Mar 06-Apr 13-Apr 20-Apr 27-Apr 04-May 11-May 18-May 25-May 01-Jun 08-Jun 15-Jun 22-Jun 29-Jun 06-Jul 13-Jul 20-Jul 27-Jul

Cape of Good Hope (West>East) Crude Oil tankers crossings(7 day rolling total) Cape of Good Hope (East>West) Crude Oil tankers crossings(7 day rolling total) Source: Bloomberg, CBRT, MUFG Research

End of day comment – 24 July 2026. Another day of spread widening. In the morning there was a bit of pushback against the 10/15bp widening of the ADGB long end yday. Some buying in 49s and 54s emerged lifting cash prices a touch but there wasn't any more activity in the afternoon and ADGB long end goes out +0.125pt/+2bp. The spread widening in the belly was more pronounced. The market is long and took cash prices lower (-0.125/-0.375pt). Coupled with the UST move higher you are looking at spreads being 5/8bp wider across UAE/QATAR sovgn and quasis. OMAN is still outperforming a touch especially if you look at spreads over a week or month (guess who has not issued public or private bonds). In corps ALDAR hybrid which got sold in the prior days continued to get offered down, 56s closing -0.5pt/+15bp. To be sure overall volumes were very low, and Friday spread moves can be significant. It is though pretty clear that techs remain firmly negative as the street has bonds to go. Only a change in flows will reverse the widening. (Source: Dominik Roth, Credit Trader)

PIF signs USD15bn financing framework with US EXIM. Saudi Arabia’s Public Investment Fund (PIF) signed a USD15bn MoU with the Export-Import Bank of the United States to establish a financing framework supporting strategic investments and procurement from US companies. The agreement will provide long-term export credit financing for eligible PIF portfolio companies purchasing US goods and services, while expanding cooperation in sectors including advanced technology, aerospace, infrastructure, future mobility, water security and critical minerals. The deal builds on PIF’s broader capital-raising strategy and existing partnerships with international export credit agencies. The fund noted that the US is its largest international market, with…