Gulf Index sees its worst week in nearly two years

27 August 2014

All markets declined apart from those of Qatar and Saudi Arabia

Between 19 and 26 August the Gulf Index saw its biggest weekly decline since September 2012 as the index dropped by 0.9 per cent, and the region’s project market lost more than $31bn in value.

All markets declined apart from those of Qatar and Saudi Arabia, which both saw muted gains.

The worst performer by per cent change was Iraq, which dropped by 2.7 per cent as $13bn was wiped off its project market.

The contraction was driven by oil and construction projects that were put on hold due to political instability and ongoing fighting.

Project updates
 Project NameProject Status
KuwaitDoha LinkExecution
KuwaitSabah al-Salem University: Academic support buildingsMain contract bid
OmanOman National Railway: phase 1 – section 1 Main contract bid
QatarFox Hills housing complex in LusailExecution
UAEEtihad Railway Network: Phase 2: Package CMain contract bid
For further information visit www.meed.com/meedprojects

Jihadist group Islamic State in Iraq and Syria (Isis) continues to occupy a third of the country, including Mosul, Iraq’s second biggest city.

In June it announced it had formed an Islamic caliphate in an area straddling Iraq and Syria. Since then it has largely thwarted Baghdad’s Western-backed efforts to claw back lost cities.

UAE was the second largest decliner over the week dropping by 2.4 per cent, its biggest drop in more than a year.

Upcoming tender deadlines
 ClientContractSubmission date
OmanOman Power & Water Procurement CompanyQurrayat water projectSep-14
Saudi ArabiaMecca MunicipalityMecca Metro: phase 1Sep-14
UAEDubai Electricity & Water AuthorityM station expansionSep-14
KuwaitMinistry of Electicity & WaterOverhead lines - various locationsSep-14
OmanTransport & Communications MinistryBatinah Expressway: package 822-Sep
For further information visit www.meed.com/tenders

The drop came as a raft of construction projects saw changes to their budgets and a number of transport and water projects were completed.

Oman’s project market contracted by 0.7 per cent as some speculative projects in the industrial sector were shelved.

Saudi Arabia expanded by 0.2 per cent boosted by new residential projects and Qatar expanded by 0.3 per cent, buoyed by changes to the Al-Sejeel Petrochemical Complex project. The partners behind the package confirmed that there would be a $1bn offsites and utilities package.

During the week Qatar Petroleum and Qatar Petrochemical Company began the prequalifying process for the complex’s last two remaining packages.

Kuwait dropped by 0.3 per cent over the week and Bahrain, the region’s smallest project market, remained unchanged.

Contract awards

Biggest contract: $68m

Al-Hassan wins $68m piping deal to expand Oman’s Sohar refinery

Value of major contract awards: $68m

Number of contracts awarded: 1

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