After a week of this war, there are no signs of the conflict slowing down. In fact, US Defence Secretary Pete Hegseth has categorically said that there would be a “dramatic surge” in America’s air campaign against Iran. On the other hand, Tehran has vowed to destroy not only Gulf military infrastructure but also its economic assets, which is what has rattled the financial markets.
Despite clarification that it did not permit its soil to be used against Iran or participate in any warfare, the Gulf has been left to defend against hundreds of missiles being targeted not just at its territory but also at its economy.
Qatar’s minister has said that this war will take world economies down, considering that at the epicentre of this dastardly war is an element everyone wants to own – oil.
Pressure on Gulf’s available stockpile could grow
Both Qatar and the United Arab Emirates had on March 3 rejected claims of their supplies were running low. In a statement, Qatar had said that its military still had a strong reserve of Patriot interceptor missiles and that its inventory had not been exhausted.
Countries usually keep details about their missile stockpiles secret. Revealing exact numbers could help an enemy calculate how many missiles are needed to overwhelm defence systems and how long those systems could hold out. So there is no confirmed public data on how many missile interceptors Gulf countries originally had in their stockpiles.
Some clues about the scale of these arsenals come from documents released by the Defense Security Cooperation Agency (DSCA) in the United States. These documents suggest the UAE has ordered more than 1,000 PAC-3 interceptor missiles, along with older variants, over the past 15 years. Even so, such numbers could cover only a few days if the current pace of interceptions continues.
According to the DSCA documents, Washington is also facing tough choices when it comes to deciding where to send its missile defences. It must balance support for partners in West Asia while ensuring its own forces in the Pacific remain prepared to deal with the large missile capabilities of China.
Production capacity highlights the challenge further, as The Economist has reported.
Lockheed Martin currently manufactures about 600 PAC-3 interceptor missiles each year. The company hopes to expand that number to roughly 2,000 annually over the next seven years.
Production of interceptors for the Terminal High Altitude Area Defense (THAAD) system is lower. Lockheed Martin aims to increase output to about 400 missiles a year, but current production is believed to be around 96 annually.
This means that, during intense conflict, Gulf countries could be using more interceptors in a day or two than the US defence industry produces in an entire year.
If fighting continues for more than a week, pressure on available stockpiles could grow quickly. Governments may then have to use their interceptors carefully, deciding which critical locations must be protected and which areas might have to remain exposed.
Will missile stocks, defence systems, and strategy shape the balance in Gulf?
The effectiveness of missile defence does not depend only on the number of interceptors available. Many Gulf countries operate standard defence systems that are purchased from abroad. These may not always be designed for the specific threats they face. Israel, in contrast, has built specialised systems tailored to its security needs.
Successful missile defence also relies heavily on radar and tracking technology, including systems on the ground and in space, which guide interceptors more accurately toward incoming targets.
Ran Kochav, a former brigadier-general who once led Israel’s missile defence forces, told The Economist that the defence systems purchased by several Gulf nations may not be fully suited to their requirements. He argues that these countries depended on individual systems instead of building a wider national missile-defence network that integrates all necessary components.
Weak coordination between different systems is believed to be one reason why the missile defences of Saudi Arabia have not performed as well as those of Qatar, The Economist reported, citing a Gulf official familiar with the data.
There have been reports suggesting that some Gulf governments are uneasy about the war and want Washington to push for an end to the conflict, fearing damage to cities and infrastructure. But privately, many officials in the region appear confident and have not shown clear opposition to one of the goals stated by Donald Trump: the destruction of Iran’s missile industry.
Could Google, Amazon, Microsoft data centres in Gulf take the hit?
For years, tech giants such as Google, Amazon, and Microsoft have invested heavily in building data centres across the Gulf, with the vision and belief that these countries could become a major global centre for artificial intelligence.
Global non-profit publication Rest of World reports that the digital infrastructure supporting these facilities depends heavily on a small number of routes. The undersea internet cables that connect Gulf data centres to Africa, South Asia and Southeast Asia pass through two narrow waterways, that is the Red Sea and the Strait of Hormuz. Both routes are now effectively closed to normal commercial traffic because of rising tensions in the region.
Around 17 submarine cables run through the Red Sea. These cables handle most of the data traffic moving between Europe, Asia and Africa. Several other cables pass through the Strait of Hormuz, connecting countries such as Iran, Iraq, Kuwait, Bahrain and Qatar.
Experts suggest that the situation is particularly risky because repair crews would struggle to reach the area if any of these cables were damaged. Doug Madory, who leads internet analysis at the network intelligence firm Kentik, told Rest of World that a scenario where both key maritime routes get closed at the same time could cause major disruption to global connectivity. He added that such a situation has never been seen before.
Security analysts say the Gulf’s digital infrastructure has never faced a crisis of this scale. Citing Sam Zabin of the Center for Strategic and International Studies, the report explained that oil infrastructure in the region has long been built to withstand conflict and is closely tied to military planning. Data centres, however, were traditionally viewed as commercial projects rather than strategic assets.
Specialists say the cables themselves are unlikely to be deliberately targeted in the near term. Damaging them intentionally would require actions such as dragging a ship’s anchor across the seabed or striking a cable landing station. Analysts also point out that any deliberate attack by Iran could risk cutting its own internet connections.
Impact on UAE Real Estate
The property boom in the UAE is facing another challenge. The attacks have raised concerns about how much cities like Dubai and Abu Dhabi depend on foreign money to support their rapid construction and real estate growth.
Missiles hit airports, ports and residential areas in both cities, which damaged the region’s image as a stable and secure investment destination. The strikes also came at a time when there were already worries that the property market might be overheating. Developers who were earlier selling off-plan homes within hours are now dealing with a much more uncertain demand situation, the report added.
The impact was visible in the stock market on Wednesday. Shares of major property developers in Dubai and Abu Dhabi dropped sharply. Aldar Properties, the biggest listed developer in Abu Dhabi, and Emaar Properties, the company behind downtown Dubai and the Burj Khalifa, both saw their shares fall by around 5%.
Some companies tried to calm concerns and suggested that the market would recover. Ziad El Chaar, chief executive of luxury developer Dar Global, told Reuters that the Gulf had seen sudden crises before but usually bounced back quickly because the economic fundamentals across the Gulf Cooperation Council countries remain strong. He indicated that projects were continuing as planned and that no developments had been paused.
However, others in the industry said the impact was already being felt. A senior real estate banker told Reuters that his firm had postponed a plan to raise funds for a property project in the UAE. According to him, many investors are currently reluctant to put money into the region, as the risks have increased.
He also said the perceived risk attached to UAE property investments has risen sharply. If the conflict continues, international lenders may also become cautious about offering new loans. That could limit funding for developers and might even force some companies to sell assets to manage their finances.
Real estate consultancy Anarock said that the long-term outlook for the UAE property market remains supported by strong global investment and steady housing demand from expatriates. However, property deals could slow for a while as buyers become more cautious and review the risks before committing to purchases.
The report explains that geopolitical tensions usually affect property markets through changes in buyer behaviour rather than causing an immediate fall in prices. As a result, the first impact is usually a slowdown in the number of property deals rather than a sudden drop in property values. Price changes, if they occur, tend to happen later depending on how long the uncertainty continues.