Middle East

SOOJIN KIM Analyst Middle East Daily DIFC Branch – Dubai T: E: 10 August 2026

MUFG Bank, Ltd. and MUFG COMMODITIES / ENERGY Securities plc A member of MUFG, a global financial group Oil extends gains as Hormuz deal remains elusive. Brent crude traded above USD84/b, while WTI hovered near USD79/b, extending gains as Iran and Oman remained short of an agreement to restore normal shipping through the Strait of Hormuz. Iran’s Foreign Minister Abbas Araghchi said a deal was “very close” but cautioned that it would not immediately reopen the waterway. While Iran reiterated conditions including sanctions relief and an end to the US naval blockade. Supply risks were reinforced by another tanker incident in Hormuz and a Houthi-claimed attack on Saudi Arabia’s Jazan refinery where a fire was later extinguished. Although weak Chinese demand and emergency reserve releases have helped cushion the market, available supply buffers remain thin. With Hormuz flows still constrained and regional attacks continuing, oil prices are likely to retain a sizeable geopolitical premium despite tentative diplomatic progress.

Gold holds above USD4,300/oz as weak US jobs data eases rate hike risk. Gold steadied above USD4,300/oz after surging more than 7% last week, its strongest weekly gain since late January, as unexpectedly weak US labour market data reduced expectations of a near-term Fed rate hike. US employers cut jobs in July, and prior months were revised lower, pushing the dollar down and supporting gold, while investors now await inflation data for further guidance on the Fed outlook. Sentiment has also been reinforced by stronger investor demand, with hedge funds raising bullish gold positions to a six-month high and Chinese gold-backed ETFs extending inflows. The PBoC also added 640,000oz to reserves in July, marking a 21 st consecutive month of purchases. With rate hike expectations easing and geopolitical risks around Hormuz and the Red Sea still elevated, gold remains well supported.

IRAN CONFLICT TO WEIGH ON KUWAIT OIL EXPORTS 2,000 130 1,800 120 1,600 1,400 110 1,200 100 1,000 800 90

Jan-23 Mar-23 May-23 Jul-23 Sep-23 Nov-23 Jan-24 Mar-24 May-24 Jul-24 Sep-24 Nov-24 Jan-25 Mar-25 May-25 Jul-25 Sep-25 Nov-25 Jan-26 Mar-26 May-26 Jul-26

Kuwait Oil Export ('000b/d, LHS) Brent prices (USD/b, RHS)

Source: Bloomberg, MUFG Research

End of day comment – 07 August 2026. Very quiet session, interrupted by some rates volatility around the NFP print. Spreads are broadly unchanged in the long end and 1/2bp wider in the front/belly on the UST curve steepening. However, over the week we tightened 5/10bp as we are starting to see more inflows (mainly from ETFs) which steadily improved technicals. We still have to go over big macro events with next week’s CPI and the Iran/ Hormuz situation. On the latter the market is still awaiting any announcement and with the lack of it oil is starting to move higher/ UST are off the highs. (Source: Dominik Roth, Credit Trader)

Syria deepens engagement with World Bank and IMF. Syria is stepping up cooperation with international financial institutions as the government seeks to rebuild core economic institutions, restore financial sector capacity and ease its isolation from global capital flows. The World Bank approved a new USD100 million IDA grant to support the creation of a modern, secure and digitally enabled financial sector, taking total approved World Bank development grants to around USD491 million. Previous grants have included USD146 million for electricity, USD150 million for water, USD75 million for health, and USD20 million for public financial management, while the government aims to secure additional support for education, agriculture, transport, social protection and environmental management, potentially lifting total World Bank grants to nearly USD1bn over the next three years. Separately, the IMF agreed a broad technical assistance programme covering fiscal reform, revenue mobilisation, public debt management, banking sector rehabilitation, while also advancing work on debt sustainability and economic data. The growing engagement should improve institutional credibility and help reconnect Syria with…