Dubai – September 2025
The Gulf Cooperation Council (GCC) region is positioned to defy global headwinds. The GCC is forecast to grow 4.1% in 2025, accelerating to 4.6% in 2026, compared with global GDP growth of just 2.7%.

Oil Rebound: Fueling the Upside

The catalyst for this resurgence is the rollback of OPEC+ production cuts, with about 2.5 million barrels per day of supply restored by October. This has lifted forecasts for energy-sector growth to 4.9% in 2025 and 6.0% in 2026. The bulk of excess capacity lies in the UAE and Saudi Arabia, making them the primary beneficiaries.

Diversification and Non-Oil Momentum

While oil remains important, the GCC’s ability to sustain growth depends increasingly on its non-hydrocarbon sectors:

·  Across the region, non-oil activity is projected to expand 4.0% in 2025, driven by tight labor markets, rising consumer confidence, and continued reforms.

· In the UAE, non-oil growth is forecast at 4.5%, with non-hydrocarbon sectors already accounting for 77% of GDP. In Q1 2025, GDP rose 3.9%, with non-oil activity up 5.3%. The Central Bank now expects 4.9% full-year growth.

·In Saudi Arabia, non-oil exports jumped 16.5% year-on-year in the first half of 2025. Non-oil sectors—especially in construction, logistics, trade, and finance—are expected to sustain growth of around 5%.

These trends reflect how diversification has moved from policy talk to measurable economic resilience.

Fiscal Balance & Monetary Tailwinds

Not all GCC states will benefit equally: Saudi Arabia is expected to run a deficit of around 3.6% of GDP, while the UAE and Qatar are projected to maintain fiscal surpluses.

Monetary policy also works in the region’s favor. As the US Federal Reserve signals rate cuts, Gulf central banks (pegged to the dollar) are following suit. The UAE recently cut rates by 25 basis points, reinforcing momentum in real estate, credit expansion, and business investment.

Outlook & Risks

The GCC’s mix of energy tailwinds and structural reform offers a compelling investment narrative. If the forecasts hold, the region will reassert itself as the fastest-growing major region globally, with the UAE likely emerging as the standout performer.

However, risks remain: oil price volatility, global demand softness, and geopolitical frictions could temper the upside.

👉 Dubai Momentum Insight: The GCC’s growth story is no longer just about oil—it’s an evolving era of hybrid strength, where energy wealth, diversification, and investor-friendly reforms converge to make the Gulf one of the most attractive growth frontiers in 2025–26.