The Gulf Projects Index remained unchanged in the week up to 8 July, as a 3.7 per cent contraction in Kuwait was offset by expansions in Oman, Iraq, the UAE and Saudi Arabia.

Iraq’s project market continued to grow, expanding more than any other Gulf state, even as Islamic State in Iraq and Syria (Isis) militants made further progress in the establishment of a rogue state bridging the borders between Iraq and Syria.

Iraq saw the value of it index rise by 1 per cent to $516bn, supported by new projects in Iraqi Kurdistan, which has remained stable due to security provided by Peshmerga armed forces.

The UAE projects market expanded by $2.05bn, making it the second-biggest gainer on the index. The 0.3 per cent growth was driven by 39 new initiatives, mainly residential and commercial construction projects. The combined budgeted value of the new projects was in excess of $1bn.

Saudi Arabia’s project market grew by $1.4bn, driven by the launch of eight new schemes. Five of these, worth a combined $3bn, were tendered by Saudi Aramco.

It is planning to expand facilities at the Khurais oil field, adding 300,000 barrels a day (b/d) to the field’s current capacity of 1.2 million b/d.

Kuwait saw the biggest movement on the Gulf Projects Index in the week as its project market contracted by 3.7 per cent, due to the reassessment of budget values.

Iran’s projects market saw the second-biggest decline. Its index shrank 0.8 per cent, as several large gas field developments were put on hold.

Talks are currently under way with the international community over Tehran’s nuclear programme. If sanctions are lifted it could lead to a revival in Iran’s projects sector, which is down 7.1 per cent year-on-year.