HomeAll NewsEducationTV
Equities & FundsCrypto & Digital AssetsAI & TechnologyBusiness & CorporateUS Politics & PolicyGeopolitics & Global RiskMacro, Rates & FXCommodities & EnergyEuropean Politics & MarketsAsia-PacificReal Estate & Property
Story archiveAll categories
← All Stories

Iran escalation strains Gulf alliance

Created at 25 Jul · 8:11 PM1 source↑ Market-relevant
IN SHORT

Gulf states are struggling to unite against Iran's escalating attacks due to differing priorities and long-standing tensions, complicating diplomatic efforts to resolve the conflict and ensure safe passage through the Strait of Hormuz.

✉Newsletter

PiQ Daily

Pick your topics. Get only what matters, on your cadence.

Key Numbers

1981GCC founded

Who's Involved

David Schenker
Former U.S. official handling Middle Eastern affairs
Allison Minor
Former National Security Council director for Yemen and Oman
John “Fozzie” Miller
Retired Navy Vice Adm. and former commander of U.S. Fifth Fleet
Olivia Wales
White House spokesperson
Michael Ratney
Former U.S. Ambassador to Saudi Arabia
Matthew Kroenig
Former Pentagon advisor on global defense strategy
Donald Trump
President of the United States

↳ Why This Matters

The divisions among Gulf states complicate efforts to de-escalate tensions with Iran, secure vital shipping lanes like the Strait of Hormuz, and achieve regional stability, potentially prolonging the conflict and its economic repercussions.

Key facts

  • Gulf states are divided on how to respond to Iran's escalating attacks, hindering unified diplomatic efforts.
  • Differing priorities, economic vulnerabilities, and historical tensions are exacerbating divisions within the Gulf Cooperation Council (GCC).
  • Some Gulf nations can bypass the Strait of Hormuz for oil exports, while others cannot, influencing their strategic approaches.
  • The UAE's withdrawal from OPEC and its defense ties with Israel have created friction within the region.
  • The U.S. maintains strong relationships with individual GCC countries but faces internal policy splits on regional engagement.

Gulf states are struggling to present a united front against Iran's escalating attacks, hampered by divergent priorities, economic vulnerabilities, and long-standing regional disputes. While countries like the United Arab Emirates and Saudi Arabia have engaged in diplomatic efforts and issued joint statements condemning Tehran's actions, deep-seated divisions within the Gulf Cooperation Council (GCC) are impeding progress toward a unified strategy.

These internal rifts are exacerbated by differing national interests, including alternative shipping routes, entanglement with Iran's infrastructure, and varying economic impacts from the ongoing crisis. The UAE's recent withdrawal from OPEC, partly attributed to disagreements over the Iran conflict, has further strained relationships, particularly with Saudi Arabia. Some analysts describe the GCC as "nonfunctional" due to these extant divisions.

The varied strategic approaches stem from differing vulnerabilities. Saudi Arabia, the UAE, and Oman can bypass the critical Strait of Hormuz for oil exports, unlike Qatar, Kuwait, and Bahrain. This disparity influences their willingness to confront Iran directly. Despite calls for unity and coordination, particularly in light of renewed U.S. strikes and Iranian retaliatory attacks on Bahrain, Kuwait, and Jordan, as well as Houthi proxy actions, the bloc remains fractured.

U.S. officials acknowledge strong bilateral relationships with GCC members but note internal policy disagreements regarding regional engagement. While the White House emphasizes partnerships, some in the Pentagon reportedly favor a strategy of disengagement, allowing regional powers to manage the conflict. The situation is further complicated by historical grievances, such as Saudi Arabia's past actions in Yemen and the recent end to the blockade of Qatar.

Despite these challenges, there are efforts to foster cooperation, including joint visits to the U.S. Congress and State Department. An MOU signed between the U.S. and Iran on June 15 reportedly brought regional countries together with a shared goal of ensuring oil and gas movement. However, persistent mistrust remains, with concerns that some nations might be covertly funneling funds to Tehran, potentially at the expense of their neighbors.

Frequently asked questions

The GCC is a regional political and economic union founded in 1981, comprising Bahrain, Kuwait, Oman, Qatar, Saudi Arabia, and the United Arab Emirates.

Differing priorities in responding to Iran's attacks, economic vulnerabilities, alternative shipping routes, and historical disputes are causing divisions.

Ensuring the safe passage of oil and gas through the Strait of Hormuz is a common goal, but disagreements exist on the best approach to achieve it.

What Happens Next

01Gulf countries may continue to coordinate messages and diplomatic efforts with U.S. officials.
02Further discussions are expected regarding the security of the Strait of Hormuz.
03The impact of differing national priorities on future GCC actions will likely become clearer.

Get the newsletter.

Pick the topics you actually care about. We'll email when there's news worth your time, on the cadence you choose. Cancel any time from your account.

Cadence

How It Developed

Gulf states and Jordan have held meetings with U.S. officials to condemn Iranian attacks.
The UAE withdrew from OPEC in April, partly due to divisions over the Iran war.
Iran has retaliated with strikes on Bahrain, Kuwait, and Jordan.
Houthi proxies attacked Saudi tankers in the Red Sea.
The Saudi-led coalition struck Houthi targets in response.
The U.S. and Iran signed an MOU on June 15, which appeared to bring regional countries together.
The White House stated the U.S. maintains excellent relations with GCC countries.
Bahrain stated the security of GCC states is indivisible.
Sponsored

London Quick Take - 22 July - UK inflation softens, oil rises and chips rally ahead of Alphabet, Tesla earnings

SAXO

Sources

T1
Iran escalation wears at Gulf alliancePolitico

Related Stories

Iran Guards: Britain a 'definite target' if backing US in war
25 Jul · 8:23 PM
Iran denies responsibility for Yemen conflict, cites 'old disputes'
25 Jul · 10:46 AM
US military disables tanker attempting to breach Iran port blockade
24 Jul · 10:41 PM
Chinese Tankers Traverse Red Sea Amid Houthi Blockade Threats
25 Jul · 9:16 AM
Trump Halts Iran Strikes Amid Hormuz Talks; Houthis Attack Saudi Oil Sites
25 Jul · 6:46 PM