EMIR Situation Room

Today’s Intelligence Brief (Day 87)

UPDATED AS OF MAY 25, 2026 - 06:00 AM GST

Day 87: The key shift over the last 24 hours is that the US is now openly compressing the timeline. Trump’s language — "Friday, Saturday, Sunday or early next week" — effectively turns the next few days into a decision window, or at least the next cycle of deadlines as pressure builds in the system. At the same time, Washington continues to escalate pressure economically and rhetorically, while hinting that another strike package remains possible if Tehran does not move.

Iran, however, is not acting like a country preparing to concede. Tehran remains defiant, continues to insist on enrichment rights, sanctions relief, compensation and Hormuz leverage, and appears increasingly convinced that time favours Iran more than Washington. The strategic asymmetry remains central: for the US, this is becoming a politically inconvenient war with rising economic costs and weakening domestic support. For Iran, it is still framed as an existential confrontation in which endurance is preferable to surrender.

The ceasefire architecture also continues to erode at the edges. Lebanon remains the most active spoiler front, with ongoing Israeli strikes, displacement warnings and Hezbollah attacks despite the formal truce. The repeated drone incidents over Saudi Arabia and previous strikes near the UAE’s Barakah nuclear site reinforce that GCC infrastructure remains exposed even during "pause" periods. Saudi Arabia and Qatar are therefore trying to buy time diplomatically because they understand that another escalation cycle could rapidly widen into a deeper regional infrastructure war.

Hormuz remains the core strategic lever. Tehran’s demands for recognition of its management role in the Strait remain fundamentally incompatible with US and GCC positions. Meanwhile, the US blockade continues to squeeze Iran economically, but without producing clear concessions. This is the heart of the stalemate: Washington believes pressure must intensify to force movement; Tehran believes pressure proves why it must not give in.

Bottom line: The conflict is no longer moving toward either clear war or clear peace. It is moving toward a decision point. Time is ticking, more for Trump than the Iranians.

Monitor the MoU

14-point Memorandum · full text

Memorandum of Understanding · 14 Points

CEOs in MENA should closely monitor the progress of the next wave of talks between the US and Iran. The full 14-point Memorandum of Understanding is set out below.

1

Ceasefire & Permanent End of War

The United States of America and the Islamic Republic of Iran and their allies in the current war, by signing this MOU, declared the immediate and permanent termination of military operations on all fronts, including in Lebanon, and undertake from now on not to initiate any war or any military operation against each other, and to refrain from the threat or use of force against each other and ensuring the territorial integrity and sovereignty of Lebanon. The final deal will confirm the permanent termination of the war on all fronts, including in Lebanon and other provisions of this paragraph.

2

Sovereignty & Non-Interference

The United States of America and the Islamic Republic of Iran undertake to respect each other’s sovereignty and territorial integrity, and to refrain from interfering in each other’s internal affairs.

3

Negotiation Timeline

The United States of America and the Islamic Republic of Iran commit to negotiating and achieving the final deal in maximum 60 days, expendable with mutual consent.

4

Naval Blockade Removal

Immediately upon the signing of this MOU, the United States of America will begin the removal of its naval blockade and any disturbances or impediments against the Islamic Republic of Iran, and will fully end the naval blockade within 30 days. During this period, the traffic of vessels will be in proportion to the numbers of pre-war traffic being restored by the Islamic Republic of Iran. The United States of America further undertakes to remove its forces from the proximity of the Islamic Republic of Iran within 30 days after the final deal.

5

Hormuz — Safe Passage & Administration

Upon the signing of this MOU, the Islamic Republic of Iran will make arrangements using its best efforts for the safe passage of commercial vessels with no charge for 60 days only from the Persian Gulf to the Sea of Oman and vice versa. The traffic of commercial vessels will immediately start, and considering the need for removing the technical and military obstacles and demining by the Islamic Republic of Iran, will be instated within 30 days. The Islamic Republic of Iran will conduct dialogue with the Sultanate of Oman to define the future administration and maritime services in the Strait of Hormuz, in discussion with other Persian Gulf littoral states in line with the applicable international law and the sovereign rights of coastal states of the Strait of Hormuz.

6

Reconstruction & Economic Development

The United States of America undertakes with regional partners to develop a definitive, mutually agreed plan with at least USD $300 billion for the reconstruction and economic development of the Islamic Republic of Iran. The mechanism for the implementation of this plan will be finalized as part of a final deal within 60 days. All required licenses, waivers, and permissions needed for the relevant financial transactions will be granted by the United States of America.

7

Sanctions Termination

The United States of America undertakes to terminate all types of sanctions against the Islamic Republic of Iran, including the United Nations Security Council resolutions, IAEA Board of Governors resolutions, and all unilateral U.S. sanctions—primary and secondary—in an agreed upon schedule as part of the final deal. The Islamic Republic of Iran and the United States of America acknowledge the critical importance of the sanctions termination issue above mentioned and expressed their intentions to immediately address these issues in the negotiations in order to achieve mutual agreement on them.

8

Nuclear Commitments & Enrichment

The Islamic Republic of Iran reaffirms that it shall not procure or develop nuclear weapons. The United States of America and the Islamic Republic of Iran have agreed to resolve the disposition of stockpile enriched material pursuant to a mechanism that will be mutually agreed upon in accordance with the schedule mentioned in paragraph seven, with the minimum methodology to be down blending on site under the supervision of the IAEA. The two parties also agreed to discuss the issue of enrichment and other mutually agreed matters related to the Islamic Republic of Iran’s nuclear needs, based on a satisfactory framework being agreed upon in the final deal. The final deal will confirm the provisions of this paragraph. The United States of America and the Islamic Republic of Iran acknowledged the critical importance of the nuclear issues above mentioned and expressed their intention to immediately address these issues in the negotiations in order to achieve mutual agreement on them.

9

Status Quo Pending the Deal

Pending the final deal, the United States of America and the Islamic Republic of Iran agree to maintain the status quo. The Islamic Republic of Iran will maintain the current status quo of its nuclear program and the United States of America will not impose any new sanctions and will not deploy additional forces in the region.

10

Oil Export Waivers

The United States of America undertakes that immediately upon the signing of this MOU and until the termination of sanctions, the U.S. Department of Treasury will issue waivers for the export of Iranian crude oil, petroleum products and derivatives, and all associated services, including banking transactions, insurances, transportation, etc.

11

Release of Frozen Assets

The United States of America undertakes to make fully available for use the frozen or restricted funds and assets of the Islamic Republic of Iran. Upon the implementation of the MOU, the United States of America and the Islamic Republic of Iran will mutually agree on the procedures related to the release of these funds during the negotiations. Such funds, whether retained in the original account or transferred, shall be made fully usable for payment to any ultimate beneficiary designated by the central bank of the Islamic Republic of Iran. The United States of America undertakes to issue all the necessary licenses and authorisations accordingly.

12

Executive Monitoring Mechanism

The United States of America and Islamic Republic of Iran agree that an executive mechanism will be established to monitor the successful implementation of this MOU and the future compliance of the final deal.

13

Sequenced Negotiations

After signing this MOU, and subject to the beginning of the implementation of paragraphs 1, 4, 5, 10, and 11 of this MOU, and the continuing implementation of these measures, the United States of America and the Islamic Republic of Iran will start negotiations regarding the final deal exclusively on the other paragraphs.

14

UN Security Council Endorsement

The final deal will be endorsed by a binding United Nations Security Council resolution.

Bottom Line

The immediate risk of major US-Iran escalation has fallen significantly, but the probability of crises, violations and political confrontation during implementation remains high. Lebanon is the central fault line. If Washington can keep that front contained, the agreement has a chance. If not, the entire framework could begin to unravel.

EMIR Negotiation Progress Framework

Negotiation Progress

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Methodology

The purpose of this framework is to provide CEOs, investors, boards and policymakers with a structured assessment of whether a conflict is moving toward a durable political settlement or returning toward confrontation. Unlike traditional diplomacy trackers, which focus on meetings, statements and announcements, this framework measures whether negotiations are successfully progressing through the critical stages required to achieve a sustainable agreement.

The methodology is built around four components:

Negotiation Phases
Negotiation Dashboard
Negotiation Momentum Score
Negotiation Breakdown Risk Indicator

1 · Negotiation Phases

Negotiations are assessed according to the phase they have reached. Progression is sequential — a negotiation cannot be considered to have entered a later phase unless the majority of key conditions in the preceding phase have been met.

Phase 1: Stabilisation

Objective: Stop active conflict and prevent immediate escalation.

Indicators:

Ceasefire implementation
Reduction in military activity
Reopening of strategic trade routes
Removal of blockades
Prevention of force build-up
Reduction in regional spillover risks

Assessment Question: Has active conflict been sufficiently contained to allow negotiations to proceed?

Phase 2: Confidence Building

Objective: Build trust and demonstrate good faith.

Indicators:

Release of frozen assets
Initial sanctions relief
Economic confidence measures
Creation of monitoring mechanisms
Humanitarian measures
Confidence-building agreements

Assessment Question: Are both parties taking measurable steps to build trust?

Phase 3: Final Settlement Negotiations

Objective: Resolve the core dispute.

Indicators:

Nuclear framework agreements
Security guarantees
Long-term sanctions arrangements
Economic normalisation
International legal endorsements
Reconstruction commitments

Assessment Question: Are negotiators addressing the underlying causes of the conflict?

Phase 4: Implementation

Objective: Ensure long-term compliance.

Indicators:

Verification mechanisms
Monitoring frameworks
Funding delivery
Compliance procedures
Long-term oversight structures

Assessment Question: Are agreed commitments being implemented and enforced?

2 · Negotiation Dashboard

The Negotiation Dashboard measures progress across six critical areas. Each area receives a Status, Momentum and Risk.

Ceasefire: violations, military activity, escalatory rhetoric, front-line stability
Hormuz / Trade Routes: shipping activity, maritime security, energy exports, navigation restrictions
Sanctions: relief announcements, financial access, banking access, frozen asset releases
Nuclear: inspection agreements, verification progress, enrichment discussions, technical negotiations
Reconstruction: funding commitments, donor participation, implementation mechanisms, economic recovery plans
Supervisory Mechanism: monitoring arrangements, international oversight, compliance structures, enforcement provisions

Status: Green = significant progress · Amber = partial progress · Red = limited or no progress

3 · Negotiation Momentum Score

The Negotiation Momentum Score measures whether negotiations are moving forward or backward. Each critical area receives a score.

Scoring system:

+2 — Major breakthrough
+1 — Incremental progress
0 — No meaningful change
−1 — Stalling
−2 — Reversal or deterioration

The six monitored areas (Ceasefire, Hormuz, Sanctions, Nuclear, Reconstruction, Supervisory Mechanism) are scored daily and summed. Negotiation Momentum Score = sum of all six area scores.

Interpretation:

+8 to +14 — Strong Progress
+3 to +7 — Constructive Progress
−2 to +2 — Fragile
−3 to −7 — Stalled
Below −7 — Breakdown Risk

4 · Negotiation Breakdown Risk Indicator

The Negotiation Breakdown Risk Indicator measures the probability that negotiations fail and the conflict re-escalates. It is driven primarily by five structural obstacles.

The Five Critical Obstacles

Not all elements of a negotiation carry equal weight. While multiple issues may be under discussion simultaneously, experience shows that a small number of core obstacles are typically responsible for either advancing or derailing a peace process. The following five obstacles represent the most significant risks to a successful settlement and should be monitored closely throughout the negotiation process.

Obstacle 1: Israeli Spoiler Risk

This is arguably the single greatest risk to the success of any agreement. If Israeli leadership concludes that the outcome strengthens Iran strategically, economically or militarily, the likelihood of resistance to the agreement increases significantly.

The central question is not: Does Israel support negotiations?

The more important question is: Does Israel believe the agreement leaves Iran stronger than it was before the conflict?

Potential outcomes:

Military action
Intelligence operations
Political lobbying in Washington
Public opposition campaigns
Efforts to delay or undermine implementation

Monitor for:

Changes in Israeli rhetoric
New Israeli military operations
Public disagreements between the United States and Israel
Israeli concerns regarding enforcement or verification provisions

Obstacle 2: Sequencing of Sanctions Relief

The sequencing of sanctions relief has historically been one of the most contentious issues in negotiations with Iran. This disagreement will contribute to the failure or stalling of previous negotiation efforts and remains a critical fault line.

Iran’s position: Relief first.

The United States’ position: Verification first.

Key indicators to track:

Suspension of oil-related sanctions
Banking access and financial connectivity
Restoration of SWIFT access
Release of frozen assets and blocked funds

The outcome of this issue has direct implications for:

Global and regional oil supply
Shipping and trade normalisation
Foreign direct investment
Business confidence and market sentiment

Obstacle 3: Nuclear Verification

At the heart of every agreement lies a fundamental question: how does Iran demonstrate compliance?

Iran seeks assurances that its sovereignty will be respected. The United States and its partners seek credible verification mechanisms that provide confidence that commitments are being honoured. Balancing these competing requirements remains one of the most difficult aspects of any settlement.

Key indicators to track:

Access granted to the International Atomic Energy Agency (IAEA)
Inspection and monitoring provisions
Enrichment limits and caps
Treatment and disposition of nuclear materials

Strategic significance: Verification disputes have historically been among the most common causes of negotiation breakdowns and implementation challenges.

Obstacle 4: Reconstruction Funding

The proposed reconstruction programme, estimated at approximately $300bn, represents one of the largest economic components of the agreement. While reconstruction is widely viewed as necessary for long-term stability, securing the required funding may prove politically challenging.

Key political questions:

Will Washington support the funding package?
Will European governments participate?
Will Gulf states contribute at the required scale?
Can a credible financing mechanism be established?

Key indicators to track:

Funding commitments
Financing structures and mechanisms
Delivery timelines
Contributions from governments and institutions

Strategic significance: Without sufficient reconstruction funding, implementation risks increase and public support for the agreement may weaken over time.

Obstacle 5: Definition of Non-Interference

At first glance, non-interference appears straightforward. In practice, it is often one of the most disputed elements of any agreement. The challenge lies in defining what activities constitute interference and where legitimate state behaviour ends.

Areas of potential dispute:

Intelligence activity
Cyber operations
Support for proxy actors
Political influence campaigns
Regime-change rhetoric

Strategic significance: Differences in interpretation can create recurring disputes, even when all parties formally remain committed to the agreement. For this reason, clear definitions, enforcement mechanisms and dispute-resolution procedures are essential to long-term stability.

Breakdown Risk Scale:

Level 0 — Pre-negotiation: A draft, MoU, framework or channel exist and it has become a mutually accepted basis for negotiations.
Level 1 — Durable Progress: Agreement becoming self-sustaining.
Level 2 — Fragile Progress: Advancing but vulnerable.
Level 3 — Negotiating Through Disputes: Expected friction.
Level 4 — Serious Strain: Major disagreements emerging.
Level 5 — Pre-Breakdown: One side threatening withdrawal.
Level 6 — Breakdown Imminent: Core provisions failing.
Level 7 — Return to Conflict: Negotiations effectively dead.

CEO Interpretation Layer

Every assessment concludes with three questions:

Does this increase or decrease the probability of sanctions relief?
Does this increase or decrease the probability of trade and energy normalisation?
Does this increase or decrease the probability of renewed conflict?

These three outputs translate diplomatic developments into business implications for:

Oil markets
Capital allocation
Supply chains
Trade flows
Investment decisions
Regional growth expectations

This creates a consistent framework for measuring whether negotiations are progressing toward a durable settlement or drifting back toward confrontation.

Escalation Meter

Day 87

▼ NOW

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2

3

4

5

6

7

5

Current Level — of 7

Chokepoint Coercion

50% probability of escalating to Level 6 within 7 days

Military Trend

Paused operationally, but with mounting pressure for renewed escalation

Trajectory in GCC: Stable, but re-escalation is possible if Israel continues to hit Lebanon

Trajectory in Lebanon: Re-escalating, most likely spoiler theatre

Next Trigger: US hits critical Iranian infrastructure, Lebanon and collapse of MoU talks, and maritime confrontation in Hormuz, or Houthi pressure on Bab al-Mandab

Political Signalling

Mixed and confusing, with both sides preparing their publics for failure

Diplomatic Activity

Active, but Iran is not giving much up

Duration Bias — Today

Base: As of today, we expect weeks of rocky, coercive pause — no war, no peace and continued exchange of messages around an MoU, which only kicks the can down the road, and Israel to try to sabotage talks but to stop short of rupturing its relationship with the US.

Tail risk: Israel's actions in Lebanon as hardliners in Iran feel they have too much leverage, and a miscalculation could lead to a likely re-escalation — or the economic burden could drive the US to re-escalate towards a conclusive resolution rather than talks.

Escalation Framework

EMIR 7-level model

Lvl	Description	Business Meaning
1	Rhetorical Coercion	Threats rise, but markets and operations remain broadly stable
2	Controlled Military Pressure	Limited strikes, cyber activity, proxy testing, volatility without sustained disruption
3	Multi-Theatre Friction	Repeated exchanges across multiple fronts; travel, security and staff risk rise materially
4	Critical Infrastructure Exposure	Energy, aviation, telecoms, ports, desalination and logistics assets come under real threat
5	Chokepoint Coercion ← CURRENT	Hormuz and/or Bab al-Mandab become politicised, screened or partially disrupted; shipping and insurance costs spike
6	Sustained Economic Transmission	Multi-country spillover as attacks hit energy, trade, inflation, corporate operations, supply chains and public finances
7	Open Regional War	GCC states participate in war, sustained interstate conflict, major-power involvement, severe commodity shock and recession risk

Monitoring — Negotiation Rhetoric

Day 87 · 25 May 2026

US

Trump compresses deadline — "days" to reach a deal or face consequences

•Trump says Iran has only days to reach an agreement — mentioning Friday, Saturday, Sunday or early next week as the window
•He said GCC states believe a deal with Iran may be "very close" — a deal acceptable to the three Gulf states would "probably" satisfy him
•Trump said he would prefer a deal "without bombing the hell out of them" — but warned Iran may still need "another big hit"
•Trump says Iran is "begging" for a deal — the pause is short, not open-ended; his only stated red line is preventing Iran from obtaining a nuclear weapon
•He described the war as painful for Americans but "the right thing to do"
•Senator Lindsey Graham: any Iran deal must go to Congress — terms remain no enrichment, US control of enriched uranium, an open Hormuz and an end to Iran's missile programme; Graham said he remains deeply sceptical Iran will accept durable terms

Iran

Iran insists on enrichment rights and maximalist terms — open to diplomacy, ready for war

•Iran says it is negotiating without surrendering
•Gharibabadi told parliament Iran insists on peaceful enrichment rights — wants the war to end on all fronts including Lebanon, sanctions lifted, assets released and war damages paid; rejects ending enrichment or accepting only partial asset release
•Tehran also demands the US blockade be lifted and US forces withdrawn from nearby
•Araghchi cited US contradictions and broken promises as the core diplomatic obstacle — Baghaei said US demands remain unrealistic and obstacles remain large
•Gharibabadi said US threats show "readiness for massive assault" — Iran will confront any aggression "resolutely"; Iran's joint command warned enemies against making "another mistake"

Mediators Pakistan · Qatar

Pakistan hopes to restore stability; Qatar says mediation needs more time

•Pakistani minister Naqvi said Islamabad hopes to help restore stability
•Qatar says Pakistan's mediation still needs more time — Al-Ansari said Qatar supports Pakistan's serious diplomatic effort
•Doha remains in contact with Washington, Tehran and regional leaders

Monitoring — Attacks

Day 87 · 25 May 2026

Drone UAE / Iraq

UAE says nine recent drones launched from Iraq — six intercepted

•UAE Ministry of Defence said nine hostile drones were recently launched from Iraqi territory
•Six were intercepted; all targeted civilian and vital areas
•No casualties or damage to vital facilities were reported

Airstrike Lebanon

Israel strikes southern Lebanon — civilians killed, 12 towns warned to evacuate

•Israel continued shelling and strikes across southern Lebanon — artillery hit Dibbin's al-Arid neighbourhood in Marjayoun; strikes also targeted Burj Shamali's outskirts
•A drone strike in Harouf wounded two people near the municipality building; one victim was reportedly preparing to distribute bread to residents
•A later Israeli strike on Deir Qanoun al-Nahr killed four people; more than 10 were wounded, including women and children
•Avichay Adraee ordered residents of 12 towns to leave immediately — named towns included Nabatieh, Habboush, Jibshit and Burj Shamali

Interception Israel

IDF intercepts suspected aerial target over occupied southern Lebanon

•The IDF launched an interceptor at a suspected aerial target detected over territory occupied by Israeli forces
•UNIFIL separately detected seven trajectories attributed to presumed Hezbollah actors

Monitoring — Political Ripples

Day 87 · 25 May 2026

Diplomatic US / China

Trump says Xi promised China is not sending weapons — takes him "at his word"

•Trump said Xi Jinping promised that China is not sending weapons to Iran — Trump said he takes Xi "at his word"
•Beijing had earlier rejected reports that it planned arms transfers; China's role remains politically sensitive for Washington

Sanctions US Treasury

US Treasury expands "Economic Fury" sanctions during diplomacy — 19 vessels blocked

•Washington added new sanctions while still pursuing diplomacy — Treasury sanctioned Iran-based Amin Exchange and related front companies handling funds for sanctioned Iranian banks
•The US also blocked 19 vessels linked to Iranian petroleum shipments

Domestic US

US domestic support for the Iran war is weakening — polling shows majority opposition

•NYT/Siena poll found 64% said Trump was wrong to launch the war; Reuters/Ipsos poll found 53% said the administration lacks a clear strategy
•Trump still claimed the war is "frankly very popular"

Legal Israel

Netanyahu trial session shortened for security reasons

•Channel 12 said judges approved a shortened court appearance — Netanyahu appeared for his 88th session in the corruption trial
•Smotrich said the ICC is seeking an arrest warrant

Diplomatic UN · Lebanon

UN says Lebanon ceasefire must not be ignored — UNIFIL detects seven Hezbollah trajectories

•UN spokesman Dujarric said there was a cessation-of-hostilities agreement and that compliance is now a "matter of fact"
•UNIFIL detected seven trajectories attributed to presumed Hezbollah actors

Diplomatic Kuwait · Pakistan · Qatar · Saudi

Regional states deepen defence and mediation ties

•Kuwait's chief of staff met Pakistan's operations director — discussed joint defence and bilateral military ties
•Qatar said its foreign minister spoke with Saudi counterpart Faisal bin Farhan — discussed the US–Iran ceasefire and de-escalation efforts; Qatar said all parties must respond to mediation and prevent renewed escalation
•Al-Ansari said Tehran's attack on Qatar threatened bilateral relations — but Doha remains in contact with Iran

Monitoring — Strait of Hormuz

Day 87 · 25 May 2026

Diplomatic UN · G7 · Qatar · NATO

UN support for Hormuz resolution widens to 129 co-sponsors — G7, Qatar and NATO weigh in

•Co-sponsoring countries rose from about 112 to more than 129 — a Security Council vote could come in the coming days; UN says no actor should restrict Hormuz access; Farhan Haq said the UN wants no constraint on navigation
•Qatar says no country can hinder Hormuz access — Al-Ansari said freedom of passage cannot be restricted and that two LNG crossings do not mean normal traffic has resumed
•G7 finance ministers said reopening the Strait is imperative — their joint statement also reaffirmed multilateral cooperation on global economic risks
•NATO says any Hormuz mission is a political decision — Grynkewich said politicians must decide NATO's role, speaking after meeting NATO military chiefs in Brussels

Maritime US / CENTCOM

CENTCOM: 84 ships redirected, four commercial vessels disabled under blockade

•CENTCOM confirmed it has redirected 84 commercial vessels away from the Strait since the start of the conflict
•Four commercial vessels have been disabled under the blockade

Iran Position Iran

Iran demands US recognition of Hormuz sovereignty and full blockade removal

•Iranian officials say Tehran wants US recognition of its Hormuz sovereignty — Washington refuses this demand; Tehran says it is still showing flexibility in negotiations
•Gharibabadi's parliamentary report listed US naval blockade removal as a core Iranian demand alongside sanctions relief and asset release

Archetypes — Planning

25 May 2026 · Analyst judgment · Not a statistical forecast

Archetype

Core Logic

Key Trigger Point

Who Concedes First / Likely Outcome

Likelihood of a Deal

GCC Position Post-Conflict

1. Prolonged:
"Wait-It-Out"

•A pressure race between Iranian economic endurance and U.S./global energy-market endurance
•U.S. objective: keep the naval/economic squeeze in place until Iran's hard-currency position, exports, reconstruction burden, and elite cohesion deteriorate
•Iranian objective: hold out until oil prices, refined-product shortages, Asian buyer pressure, and U.S. domestic inflation force Washington into a face-saving compromise
•Iran can tolerate public suffering for longer than outside actors often assume; currency weakness, shortages, and unemployment alone may not force a strategic concession

•Mid-June is a limit on this pathway
•End-May: global stocks of crude, gasoline, diesel, and jet fuel approach critically low levels
•Early June: Brent plausibly enters the $150–200/bbl discussion if flows are not restored
•End-June: issue becomes demand destruction, industrial shutdowns, and recession risk
•IEA: ~20 mb/d moves through Hormuz; alternative pipeline capacity is only 3.5–5.5 mb/d
•Main trigger: by early-to-mid June, Washington must decide — keep waiting, accept a narrow deal, or escalate

•Before June: Iran more likely to concede first — partial Hormuz reopening, limited JCPOA-style nuclear deal
•After early June: the U.S. becomes more likely to concede strategically if oil/product markets move toward crisis
•Likely outcome: cosmetic or narrow de-escalation deal. If nuclear, missile, drone, proxy, and maritime issues are postponed, the conflict is only deferred

Narrow deal
55–70%

Durable deal
10–20%

June clock raises deal odds but lowers deal quality

🟠 Amber — deteriorating toward red if U.S. accepts a weak deal

•GCC benefits if U.S. pressure forces Iran into verified nuclear and regional concessions
•GCC loses if Washington trades blockade relief for Hormuz reopening alone

Member message

Do not support "de-escalation at any price." Support only sequenced relief: nuclear → HEU accounting → no Hormuz coercion → missile/drone limits → proxy restrictions → then relief.

2. Re-Escalation /
Military Surge

•U.S./Israel conclude blockade pressure is too slow, or Iran tests red lines through attacks on tankers, UAE infrastructure, U.S. vessels, ports, bases, or energy facilities
•New strikes could target nuclear sites, missile/drone infrastructure, IRGC command, naval assets, energy infrastructure, or leadership nodes
•Military logic: restore U.S. coercive credibility and reopen flows by force if negotiation fails

•June makes escalation more likely, not less
•If markets approach the June tipping point and Iran refuses concessions, Washington faces a binary: concede diplomatically or escalate militarily
•A spike toward $150–200/bbl creates intense U.S. domestic and global pressure
•Immediate triggers: tanker sinking, mine strike, U.S./GCC fatalities, strike on Gulf energy infrastructure, proxy attack on U.S. bases, or nuclear breakout intelligence

•Unclear who concedes first
•Best case: Iran defences fail; accepts serious concessions after military degradation
•Worst case: Iran retaliates through Gulf infrastructure; U.S. seeks ceasefire to stop oil-market panic
•Likely outcome: tactical U.S. success, uncertain strategic success. Iran may absorb pain, retaliate asymmetrically, and avoid a durable settlement

Narrow ceasefire
40–55%

Durable deal
5–15%

Escalation creates leverage but hardens positions

🟠🔴 High-risk, high-upside

•Best case: Iran's threat capacity materially reduced
•Worst case: Iran absorbs pain; GCC becomes the retaliation theatre while the U.S. later seeks an exit

Member message

Demand clear U.S. objectives, a defined exit ramp, pre-positioned missile/drone defence, port/desalination/airport/data-centre protection, and no open-ended "mow-the-grass" strike cycle.

3. Competitive Maritime Containment → Stabilised Armed Truce BASE CASE

•Neither side can impose its preferred settlement
•U.S. maintains blockade/sanctions and limited naval opening operations; Iran maintains partial Hormuz coercion but avoids a trigger for total war
•Both sides allow limited movement: escorted transit, restricted shipping corridors, humanitarian passage, partial cargo release, backchannel talks
•Not peace — a managed armed standoff

•June pressures this pathway but does not eliminate it
•Before June: most plausible equilibrium — enough disruption to preserve Iranian leverage, not enough to force immediate all-out war
•After early June: equilibrium becomes unstable — partial flows may not prevent refined-product shortages and price spikes
•OPEC+ output increases of limited use while Hormuz remains constrained; the real question is transit, insurance, and refinery feedstock — not headline production quotas

•Neither side truly concedes
•U.S. claims it prevented Iran from fully controlling Hormuz; Iran claims it retains veto power over regional stability
•Likely outcome: "No war, no peace." Some shipping resumes but insurance costs, naval risk, and investor uncertainty remain high. Nuclear, missile, drone, and proxy issues unresolved

Maritime arrangement
60–75%

Durable deal
5–10%

June makes arrangement more urgent, not more comprehensive

🟠 Amber — chronic vulnerability

•GCC avoids full-scale war but remains structurally exposed
•~93% of Qatar's LNG and ~96% of UAE LNG exports transit Hormuz — ~19% of global LNG trade

Member message

Treat as a long armed truce. Build GCC air/missile/drone defence, minesweeping, maritime surveillance, shared stockpiles, insurance backstops, GCC Rail, Fujairah/Red Sea redundancy, and emergency supply corridors.

4. U.S. Declares Victory & Withdraws

•Washington decides the conflict is politically expensive, strategically open-ended, and economically dangerous
•U.S. declares Iran has been sufficiently degraded and reduces pressure without securing a comprehensive settlement
•Not a real settlement — a political exit

•June sharply increases this pathway
•If crude/product stocks critically low by end-May and prices reprice aggressively in June, U.S. domestic pressure rises quickly
•Political problem broader than gasoline: diesel, jet fuel, industrial feedstock, freight, aviation, inflation, and recession risk
•Main trigger: U.S. concludes continuing the blockade costs more than waiting out Iran

•U.S. concedes first strategically — even if it declares victory rhetorically
•Likely outcome: immediate market relief, partial shipping normalisation, U.S. claim of success
•Iran claims it survived, retained sovereignty, and outlasted U.S./Israeli coercion — keeps much of its strategic toolkit unless withdrawal is conditional on verification

Face-saving exit
30–45%

Durable deal
<10%

Nearly incompatible with durable settlement

🔴 Red — strategically bad despite immediate relief

•Positive: markets, aviation, shipping, and investor confidence may temporarily calm
•Negative: Iran can claim it outlasted U.S. pressure and demonstrated the ability to weaponise Hormuz

Member message

Oppose any U.S. exit lacking enforceable Iranian concessions. Demand security guarantees, integrated defence commitments, no-Hormuz-coercion language, IAEA access, and a formal GCC role in follow-on negotiations.

5. Phased MoU Toward a Negotiated Settlement

•Both sides accept a face-saving package, but Iran enjoys leverage
•Iran reopens Hormuz; U.S. eases blockade; talks proceed on nuclear, sanctions, missiles, proxies, and reconstruction
•Strong version: Iran accepts verification and stockpile control before major relief
•Weak version: Hormuz reopens first, blockade ends first — nuclear/missile/proxy issues deferred

•Energy crunch makes a deal more likely but a weak deal more tempting
•By end-May, markets begin pricing scarcity; by early June, Washington, Asian buyers, and Europe push rapid de-escalation
•Good-deal trigger: Iran accepts JCPOA-like deal, IAEA access, HEU accounting, and no-Hormuz-coercion before major relief
•Bad-deal trigger: U.S. accepts Hormuz reopening as sufficient and postpones nuclear, missile, drone, and proxy files

•Most likely: narrow truce, not comprehensive settlement. U.S. more likely to want to settle
•Strong outcome: Iran concedes first on verification; U.S. phases relief after compliance
•Weak outcome: U.S. concedes first by easing blockade for Hormuz reopening; Iran preserves nuclear ambiguity, missiles, drones, proxies, and maritime coercive leverage

Narrow deal
50–65%

Durable deal
15–25%

June raises odds of quick bargain; durable deal odds remain low unless U.S. refuses to separate Hormuz from nuclear/regional constraints

🟢 Green if comprehensive · 🔴 Red if narrow

Minimum GCC conditions

•GCC seat in follow-on talks
•IAEA verification before major relief; HEU removal or verified sealing
•No Iranian tolls, safe-passage authority, or informal control over Hormuz
•Missile/drone limits + proxy financing and arming restrictions + snapback penalties
•Regional early-warning, air-defence, and maritime-security architecture

Member message

Rapid de-escalation is good only if it converts Iran's crisis leverage into enforceable constraints. Otherwise it gives Iran money, time, and legitimacy while leaving GCC exposed.

EMIR'S DURATION MATRIX — Actor Positioning

Day 87 · 25 May 2026 · 6-variable model

IRAN (9.5, 9.5)

ISRAEL (9.3, 9.7)

OVERALL (8.1, 8.1)

UNITED STATES (3.0, 3.5)

Score 0 = conducive to termination · Score 10 = strong incentive to continue · Upper-right = highest continuation pressure

Methodology

The War Duration Matrix is a decision‑support tool used by EMIR to visualise how close a conflict is to termination and what is keeping it going. It plots the positions of each main actor and the overall conflict on a two‑dimensional grid:

Military Decisiveness / Balance (X‑axis): This axis measures how close each side is to achieving a war‑ending military outcome. A low score (toward 0) means one actor has a decisive advantage or the other is on the brink of collapse; a high score (toward 10) indicates a stalemate in which neither side can compel a clear victory.
Political Incentives to Continue (Y‑axis): This axis measures how strongly each actor's leadership is tied to prolonging the war. A low score means leaders have strong reasons to accept a settlement or de‑escalate; a high score means they believe continuing the war is essential for regime survival, domestic legitimacy or strategic credibility.

To construct the matrix, we assess each actor across six supporting pillars—military decisiveness, political incentives, negotiation space, external escalation/containment, economic sustainability and domestic stability—scoring each pillar from 0 (favouring a quick end) to 10 (supporting continuation). These scores are then synthesised into an overall X and Y position for that actor. For example, an actor with high military stalemate (e.g. 8) and high political stickiness (e.g. 9) will be placed in the upper‑right quadrant, signalling a prolonged, hard‑to‑end conflict. Conversely, an actor with low military resistance and low political incentives will appear in the lower‑left quadrant, signalling a war that is close to settlement.

When reading the matrix:

Quadrants matter: The lower‑left quadrant suggests a short war or imminent settlement, while the upper‑right quadrant signals a prolonged or frozen confrontation. Movement leftwards indicates growing military decisiveness; movement downwards reflects softening political incentives.
Individual versus overall points: Each actor is plotted separately; the "overall" point is an aggregate reflecting how the war, as a system, is trending. Comparing an actor's position to the overall point reveals whether that actor is more or less willing to continue fighting than the conflict's average dynamic.
Deltas show momentum: Beside each score, we note the change (Δ) since the previous update. A negative Δ means the war is becoming easier to end on that axis; a positive Δ means it is becoming harder.

By examining both the coordinates and the deltas, decision‑makers can quickly see whether the conflict is moving toward resolution, stalemate or escalation, and which factors are driving that movement for each actor.

6-Pillar Scores

Day 87 · EMIR proprietary model

Pillar	Iran		Israel		US		Overall
	Score	Δ	Score	Δ	Score	Δ	Score	Δ
Military Decisiveness	9.5	+0.1	9.3	+0.1	3.0	0.0	8.1	+0.1
Political Incentives	9.5	+0.2	9.7	+0.2	3.5	−0.1	8.1	+0.1
Negotiation Space	9.1	+0.4	9.1	+0.3	6.2	−0.1	8.3	+0.2
External Environment	9.4	+0.2	9.3	+0.2	7.6	+0.2	9.2	+0.2
Economic Sustainability	5.6	−0.3	7.6	+0.1	4.2	−0.1	6.4	−0.1
Domestic Stability	9.0	+0.2	8.4	+0.3	3.4	−0.3	6.9	−0.1

What in our live data stream is moving EMIR’s Duration Matrix?

OVERALL

(8.1, 8.1) ↑ from (8.0, 8.0)

Assessment

May 20 lowered the immediate risk of a U.S. strike, but it did not reduce the structural duration risk. Trump said he came close to striking Iran again, postponed the attack and still warned that the U.S. may hit Iran within days if no agreement is reached. That keeps diplomacy alive, but only under a short deadline. Trump said Tehran wants a deal and that the U.S. could still strike if no agreement emerges. Trump says Iran has only days to reach an agreement, while Iran insists it is negotiating "without surrendering". Tehran is still demanding peaceful enrichment rights, sanctions relief, asset release, war-damage compensation, an end to the U.S. blockade and an end to fighting on all fronts, including Lebanon. U.S. hawks, meanwhile, are still demanding no enrichment, U.S. control of enriched uranium, an open Hormuz and an end to Iran’s missile programme. The military picture remains highly inconclusive. Hormuz is still not freely open, CENTCOM says 84 ships have been redirected and four commercial vessels disabled under the blockade, and the UAE says recent hostile drones were launched from Iraq. AP also reported UAE claims that drones targeting Barakah came from Iraqi territory, widening the risk map to Iran-aligned Iraqi militias.

US

(3.0, 3.5) ↓ from (3.0, 3.6)

Assessment

The U.S. point moves flat on military decisiveness and slightly down on political incentives. Militarily, Washington remains dominant, but still lacks strategic closure: Hormuz is not freely open, CENTCOM says 84 ships have been redirected and four commercial vessels disabled, and Iran continues to frame Hormuz as a sovereignty issue. That keeps the U.S. X-axis at 3.0, not lower. The Y-axis eases because Trump postponed a planned strike and said he would prefer a deal "without bombing", while saying a deal acceptable to the UAE, Saudi Arabia and Qatar would "probably" satisfy him. But the easing is limited: Trump still says Iran has only days, Senator Lindsey Graham says any deal must go to Congress and hard U.S. terms include no enrichment, U.S. control of enriched uranium, an open Hormuz and an end to Iran’s missile programme. Domestic politics reinforce the desire for an exit. A NYT/Siena poll showed 64% said Trump was wrong to launch the war and a Reuters/Ipsos poll showed 53% said the administration lacks a clear strategy. At the same time, Treasury expanded "Economic Fury" sanctions on Amin Exchange, front companies and 19 vessels linked to Iranian petroleum shipments, showing pressure continues while diplomacy proceeds.

ISRAEL

(9.3, 9.7) ↑ from (9.2, 9.5)

Assessment

Israel moves right and up because Lebanon is still not stabilising. Continued Israeli shelling and strikes across southern Lebanon, including Dibbin, Burj Shamali and Deir Qanoun al-Nahr; a later strike killed four and wounded more than 10, including women and children. Israel also threatened 12 Lebanese towns before further strikes, while the IDF intercepted a suspected aerial target over occupied southern Lebanon. Militarily, Israel can still strike, warn, interdict and hold pressure, but it cannot convert that into a clean Hezbollah end-state. UNIFIL detected seven trajectories attributed to presumed Hezbollah actors, reinforcing Israel’s view that Hezbollah remains active despite the ceasefire framework. Politically, incentives to continue remain extremely high because a U.S.–Iran deal does not answer Israel’s Hezbollah, buffer-zone or residual Iranian threat concerns. Additional political pressure cuts both ways but does not yet produce restraint. Netanyahu’s trial session was shortened for security reasons, and Smotrich said the ICC is seeking an arrest warrant. Those developments add domestic and legal pressure, but in the current security environment they are more likely to reinforce siege politics than push Israel into a quick compromise.

IRAN

(9.5, 9.5) ↑ from (9.4, 9.3)

Assessment

Iran moves right and up because its negotiating posture is still maximalist. Gharibabadi told parliament Iran insists on peaceful enrichment rights, wants the war to end on all fronts including Lebanon, wants sanctions lifted, assets released and war damages paid, and rejects ending enrichment or accepting only partial asset release. Iran also wants the U.S. blockade lifted and U.S. forces withdrawn from nearby. Militarily, Iran remains conventionally weaker, but its leverage is intact. Hormuz remains the central bargaining point: Tehran wants U.S. recognition of Hormuz sovereignty, blockade removal and freedom from restrictions, while the UN, G7, Qatar and more than 129 co-sponsors of a Hormuz resolution are pressing against restrictions. That pressure does not eliminate Iranian leverage; it confirms how central it has become. Political incentives to continue hard bargaining remain very high. Iran says it is open to diplomacy but ready for war, and its joint command warned enemies against making "another mistake". Qatar and Pakistan keep mediation alive, but Doha also says Pakistan's effort needs more time. This is not settlement momentum; it is hard bargaining under threat.

EMIR's Conflict Intensity Index

5-bucket weighted model · 100 = opening day (28 Feb 2026)

<100 BELOW BASELINE / CONTAINED 100–150 HIGH / ELEVATED 150–185 SEVERE 185–200 SEVERE / NEAR-EXTREME 200+ EXTREME

METHODOLOGY

The index turns daily war developments into a single comparable score by rating unique escalation events, not headline volume, across five buckets, weighting them by severity, and rebasing to 100 on 28 February 2026. It also separates “Threats” from “Acts”, so CEOs can see whether the risk is being driven by rhetoric and mobilisation or by real strikes, spillover, and strategic infrastructure disruption.

It is best read as a weekly trend line rather than a single-day pulse: a sustained rise over several days signals broadening escalation, while a steady fall points to genuine de-escalation rather than just a quieter 24 hours. For a CEO, it provides a fast, disciplined read on whether regional risk is rising or easing, helping inform decisions on people, operations, supply chains, energy exposure, travel, and capital allocation.

Bucket	Weight	Track	Definition
Threat rhetoric / coercive signalling	10%	Threat	Warnings, red lines, retaliation threats, aggressive political or military signalling
Military mobilisation / force posture	20%	Threat	Troop movements, deployment, carriers, bombers, mobilisation orders, blockades, shifts in military readiness
Regional spillover / proxy expansion	20%	Act	Escalation into Lebanon, Iraq, Syria, Gulf, Red Sea, Houthis, Hezbollah, militias, or third-country exposure
Kinetic attacks / direct conflict	25%	Act	Missile launches, airstrikes, raids, drone attacks, bombardment, and direct battlefield action
Strategic / chokepoint / critical infrastructure	25%	Act	Hormuz, Bab al-Mandab, ports, oil and gas assets, power plants, nuclear-sensitive sites, refineries

TREND

Daily Bucket Scoring	Score (1–5)
Loading...

SEVERITY SCALE

1	Minor
2	Limited
3	Meaningful
4	Major
5	War-shaping

Attacks During Ceasefire (Last 24 Hours)

Live · updating every 15 min

Loading live intelligence...

EMIR'S DIPLOMACY INDEX

5-bucket weighted model · 100 = NO MEANINGFUL EXCHANGES

<60 COERCIVE 60–79 TALKS ABOUT TALKS 80–99 NEGLIGIBLE 100–119 INDIRECT EXCHANGE 120–139 STRUCTURED DIALOGUE 140–159 FORMAL NEGOTIATIONS 160+ BREAKTHROUGH

METHODOLOGY

The index aggregates daily developments in diplomacy and de-escalation into a single comparable score by rating unique diplomatic events across five buckets. It applies a separate noise penalty for mixed messaging / coercive shadow, so contradictory claims, deadline politics, or battlefield escalation can offset apparent progress.

The index is best read as a weekly trend line rather than a single-day pulse. A sustained move above 100 suggests diplomacy is becoming more credible and structured; a move back below 100 indicates that talks are being outweighed by coercion, contradiction, or battlefield realities. For a CEO, it provides a disciplined read on whether de-escalation is becoming sufficiently actionable to influence risk posture, crisis planning, supply chains, energy exposure, travel policy, and capital allocation.

Bucket	Weight	Track	Definition
Mediation / channel activation	20%	Progress	Mediator activation, venue confirmation, third-party channel opening
Process / contact / negotiation architecture	25%	Progress	Talks held, direct contact, expert meetings, agreements to continue
Substantive progress / draft exchange	30%	Progress	Frameworks, draft exchange, narrowed gaps, counter-proposals
Verified progress / implementation	25%	Progress	Concrete de-escalatory steps, verified direct contact, implementation
Mixed messaging / coercive shadow	15%	Noise	Contradictory claims, coercive deadlines, denials, cancellations, maximalist public lines

TREND

Daily Bucket Scoring	Score (1–5)
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SEVERITY SCALE

1	Minor
2	Limited
3	Meaningful
4	Major
5	Breakthrough / war-shaping

Negotiation Rhetoric (Last 24 Hours)

Live · updating every 15 min

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Updated: 25 May 2026

Brent Crude

$111.25/bbl

▼ −0.03% (24h)

WTI Crude

$104.15/bbl

— 0.00% (24h)

Gold

$4,466.70/oz

▼ −0.99% (24h)

LNG Spot (TTF)

$17.65/MMBtu

▲ +3.12% (24h)

Hormuz Status

LIMITED NORMALIZATION / CONTROLLED ROUTING · ENERGY FLOWS NEAR PRE-WAR LEVELS · MAIN SHIPPING LANE STILL MINE-EXPOSED · IMO EVACUATION ACTIVE

Around 20m barrels and an estimated 72 vessels exited in the latest 24 hours.

Oil Prices

LNG Spot Prices

Hormuz Daily Vessel Traffic

Currency Movements

Pair	Currency	Rate	Move
USD/IRR	Iranian Rial official	1,318,161	▼ −0.06%
USD/ILS	Israeli Shekel	2.9023	▼ −0.59%
USD/TRY	Turkish Lira	45.5835	▲ +0.01%
USD/EGP	Egyptian Pound	53.3225	▲ +0.86%
DXY	US Dollar Index	99.3600	▲ +0.05%

US DOLLAR INDEX (DXY)

Shipping Indicators

25 May 2026 · 09:37 GST

Baltic Dry Index

3,151

▼ −1.40%

War-Risk Premium

1.20%

8× normal (0.15% baseline)

LNG Shipping Rate

Atl $96,500
Pac $67,000

per day · Spark30S / Spark25S

Cape Route Add

+14d

via Cape of Good Hope

Vessels Stranded

150

tankers / vessels queued

Regional Stock Markets

25 May 2026 · 06:50 GST

Country	Index	Value	Change
Loading…

Monitoring — Economic Ripples

Updated daily by AI Monitor

Loading economic ripples…

Macro Outlook

IMF WEO April 2026

Saudi Arabia

Indicator	2025	2026	2027
Nominal GDP ($bn)	1,277	1,389	1,432
Real GDP growth (%)	4.5	3.1	4.5
GDP per capita ($)	35,464	37,811	38,236
Inflation (%; avg)	2.0	2.3	2.1
Fiscal balance (% GDP)	−5.8	−3.5	−3.4
Current account balance (% GDP)	−3.0	−1.6	−3.0

UAE

Indicator	2025	2026	2027
Nominal GDP ($bn)	572	622	649
Real GDP growth (%)	5.8	3.1	5.3
GDP per capita ($)	50,232	54,214	56,179
Inflation (%; avg)	1.3	2.5	2.0
Fiscal balance (% GDP)	5.2	4.9	4.8
Current account balance (% GDP)	15.3	11.4	11.4

Iran

Indicator	2025	2026	2027
Nominal GDP ($bn)	371	300	313
Real GDP growth (%)	−1.5	−6.1	3.2
GDP per capita ($)	4,264	3,415	3,528
Inflation (%; avg)	50.9	68.9	39.6
Fiscal balance (% GDP)	−5.7	−5.2	−4.7
Current account balance (% GDP)	0.6	−1.8	−0.2

Qatar

Indicator	2025	2026	2027
Nominal GDP ($bn)	221	217	237
Real GDP growth (%)	2.8	−8.6	8.6
GDP per capita ($)	69,680	68,138	73,915
Inflation (%; avg)	0.6	3.9	2.5
Fiscal balance (% GDP)	−1.0	−3.4	−4.8
Current account balance (% GDP)	14.5	11.0	9.9

Oman

Indicator	2025	2026	2027
Nominal GDP ($bn)	106	117	119
Real GDP growth (%)	2.4	3.5	3.4
GDP per capita ($)	19,996	21,645	21,456
Inflation (%; avg)	1.0	1.7	1.9
Fiscal balance (% GDP)	1.0	5.2	4.3
Current account balance (% GDP)	1.3	7.5	5.6

Bahrain

Indicator	2025	2026	2027
Nominal GDP ($bn)	48	49	51
Real GDP growth (%)	3.1	−0.5	4.5
GDP per capita ($)	29,344	29,569	30,269
Inflation (%; avg)	−0.1	2.4	1.2
Fiscal balance (% GDP)	−13.0	−10.6	−9.1
Current account balance (% GDP)	5.9	3.9	4.8

Egypt

Indicator	2025	2026	2027
Nominal GDP ($bn)	365	430	457
Real GDP growth (%)	4.4	4.2	4.8
GDP per capita ($)	3,379	3,904	4,072
Inflation (%; avg)	20.4	13.2	11.1
Fiscal balance (% GDP)	−6.6	−12.1	−8.9
Current account balance (% GDP)	−4.2	−4.2	−4.6

Kuwait

Indicator	2025	2026	2027
Nominal GDP ($bn)	158	173	175
Real GDP growth (%)	3.5	−0.6	2.8
GDP per capita ($)	30,877	33,164	32,858
Inflation (%; avg)	2.4	2.8	2.5
Fiscal balance (% GDP)	28.4	27.6	29.5
Current account balance (% GDP)	23.3	26.0	21.8

Source: IMF WEO April 2026 Note: The WEO assumes the Middle East conflict remains limited/short-lived, with a moderate 19% rise in energy prices in 2026.

EMIR: EXPOSURE & COPING CAPACITY MATRIX

ECONOMIC EXPOSURE (0 = LOW · 100 = HIGH)

COPING CAPACITY (0 = LOW · 100 = HIGH)

Methodology

Question Answered

Which countries are being hit hardest economically by the war, and which still have the capacity to absorb, adapt to or benefit from the shock?

How It Is Built

Define each country's top five economic engines — the five that matter most for GDP, exports, fiscal revenues, employment or external earnings
Assess actual war impact at engine level. For each engine, score:
- Immediate impact (0–5): current hit since the war began
- Medium-term impact (0–5): likely drag over the next 6–24 months
- Opportunity offset (0–5): upside from higher prices, rerouting, relocation or substitution
Weighted sum of the top five engines using their economic importance weighting
Assess each country's ability to withstand the shock across five pillars:
- Sovereign / fiscal capacity
- External liquidity / buffers
- Financial-system resilience
- Operational continuity
- Policy execution
Opportunity offset — capture upside where relevant:
- Higher hydrocarbon receipts
- Trade diversion
- Port / logistics rerouting
- Tourism substitution
- Capital / business relocation

EMIR: COUNTRY-WISE ECONOMIC EXPOSURE TO TOP FIVE GROWTH ENGINES

25 May 2026

NOTE: SCORES ARE ON A 1–5 SCALE; HIGHER SCORES INDICATE GREATER SEVERITY OF WAR IMPACTS ON THE GROWTH ENGINE WITHIN THE ECONOMY.

International Tourist Arrivals

% change (year on year)¹

¹ Year-on-year, except 2021–2024 relative to 2019 · * provisional · Source: UN Tourism (May 2026)

Recovery of International Tourist Arrivals

% of 2019 levels

* provisional · Source: World Tourism Organization (UN Tourism), May 2026

International Tourist Arrivals by Region

% change (year on year)

Source: UN Tourism · Data as of May 2026 · Q1 2026 data are provisional

Expected 2026 Arrival Levels vs 2025

% of responses

Source: UN Tourism Panel of Experts Survey (May 2026)

Prospects for May–August 2026 by Region

% of responses

Source: UN Tourism Panel of Experts Survey (May 2026)

International Arrivals: Results & Outlook

Actual data 2026 Forecast

% change year-on-year, except 2021–2024 vs 2019 · (f) revised forecast · Source: UN Tourism (May 2026)

UN Tourism Confidence Index

Evaluation vs prospects · 100 = equal

T1 Jan–Apr · T2 May–Aug · T3 Sep–Dec · Source: UN Tourism Panel of Experts Survey (May 2026)

Global Tourism Inflation vs Headline Inflation

% change in consumer prices

Tourism proxy = weighted average of restaurant-hotel & transport inflation · (f) forecast · Source: UN Tourism & IMF (May 2026)

World GDP (Constant Prices)

% change

(f) forecast · Source: IMF World Economic Outlook (April 2026 Update)

Consumer Trends Expected in 2026

% of experts mentioning each factor

Source: UN Tourism Panel of Experts Survey (May 2026)

Main Challenges Facing International Tourism in 2026

% of experts mentioning each factor

Source: UN Tourism Panel of Experts Survey (May 2026)

Recovery in Global Air Traffic

% RPK change vs same month before the shock

RPK = Revenue Passenger Kilometres · Months since the shock began · Source: IATA Sustainability & Economics (Monthly Statistics)

Recovery in Regional Air Traffic

Most-affected region · % RPK change vs pre-shock

RPK = Revenue Passenger Kilometres · Months since the shock began · Source: IATA Sustainability & Economics (Monthly Statistics)

Industry RPK Growth by Region

% YoY · by airline country of registration

RPK = Revenue Passenger Kilometres · F = forecast · Source: IATA Sustainability & Economics (Monthly Statistics)

Cargo Traffic Growth by Region

CTK · % YoY

CTK = Cargo Tonne Kilometres · Source: IATA Sustainability & Economics (Monthly Statistics)

MENA Tourism Trends

Q1 2025 vs Q1 2026 · ▲ gold = increase · ▼ grey = decrease

Source: National tourism authorities · Q1 2026 (pp = percentage points)

Daily Flights of Middle Eastern Carriers

% change from pre-conflict average · Feb–May 2026

>40%

Middle East's share of global connecting traffic

9.5%

Middle East's share of global airline passenger km

Indexed daily flights of seven ME carriers vs the 23–27 Feb 2026 pre-conflict average · Source: UN Tourism / Flightradar24 (31 May 2026)

Best-Performing Destinations: Africa & Middle East Q1 2026

Africa Middle East

International tourist arrivals, % change from 2025 · Source: UN Tourism (May 2026)

Middle East Hotel Occupancy vs Global Baseline

Jan 2026 → Mar 2026

Index Jan 2026 = 100 for airline series · Source: UN Tourism Barometer (May 2026)

Dubai vs Global Hotel Occupancy

% occupancy · Jan–Mar 2026

Source: UN Tourism Barometer / STR (May 2026)

Hotel Room Openings by Region

Rooms · 2025 actual vs 2026 projected

Source: UN Tourism · hotel development pipelines (2026)

Hotel Supply Pipeline

Projected 2026

Dubai

5,053

rooms projected 2026

Qatar

2,406

rooms projected 2026

Egypt

~46,000

rooms in pipeline · 185 hotels · >1/3 of Africa's total

ME & Africa

+197%

YoY increase in projected openings

Source: UN Tourism · regional hotel development pipelines (2026)

Revenue Growth Expectations for 2026

What is your most likely revenue outcome in 2026? · % of respondents

Source: EMIR CEO surveys · Confidential · Not for redistribution

FORWARD DEMAND OUTLOOK

Demand Balance

78%

view the outlook
as negative

NEGATIVE POSITIVE

78% 22%

Source: EMIR CEO surveys · Confidential · Not for redistribution

RECESSION OUTLOOK

To what extent do you believe the GCC region is at risk of entering a recession within the next 12 months due to current geopolitical escalation?

Recession Risk

67%

see moderate to
very high risk

Source: EMIR CEO surveys · Confidential · Not for redistribution

Workforce & Labour Action

EMIR CEO Survey · Confidential

Workforce Measures

Which staffing measures have been implemented?

At a Glance

•Hiring actions dominate the staffing response.

•Harder labour actions remain limited.

•Nearly one-quarter implemented no staffing measures.

Labour Action Trigger

At what duration would you consider material workforce reductions?

Trigger Window

42%

have likely made job cuts

Source: EMIR CEO surveys · Confidential · Not for redistribution

Operating Impact vs Revenue Downside

EMIR War Survey · Mar 2026 · X = Operating Impact · Y = Revenue Disruption

High Impact

High revenue disruption + High operating impact

Revenue Pressure

High revenue disruption + Lower operating impact

Operational Strain

Lower revenue disruption + High operating impact

Resilient

Lower revenue disruption + Lower operating impact

↑ Higher Y = Greater revenue downside → Higher X = Greater operating impact

How to read this chart

Each dot represents a sector. Moving right = higher operating impact from the conflict. Moving up = greater revenue disruption. Sectors in the upper-right face the most acute combined pressure. Sectors in the lower-left remain largely insulated. Survey respondents are senior executives across 12 sectors.

Investment Disruption vs Recovery Horizon

Near-term investment disruption vs expected time to return to normal conditions

Structural Drag

Low disruption + Long recovery

High Risk

High disruption + Long recovery

Resilient

Low disruption + Short recovery

Disrupted but Agile

High disruption + Short recovery

↑ Higher Y = Longer recovery horizon → Higher X = Greater investment disruption

How to read this chart

Each dot represents a sector. Moving right = higher near-term investment disruption. Moving up = longer expected recovery horizon. Sectors in the upper-right face the most acute combined pressure. Sectors in the lower-left are best positioned to recover quickly.

Operating Impact

On a scale of 1–10, to what extent is the regional conflict impacting your ability to operate?

Scorecard

Round 1

Avg. impact 5.5/10

Round 2

Avg. impact 5.8/10

Round 3

Avg. impact 5.4/10

LOW IMPACTHIGH IMPACT

Source: EMIR CEO surveys · Confidential · Not for redistribution

Operating Posture

What operating posture are you currently in? · % of respondents

What Changed

Partial Crisis

Rose from 36% in Round 1 to 45% in Round 2, before easing to 39% in Round 3.

Normal Operations

Fell in Round 2, then recovered fully to 19% in Round 3.

Full Crisis

Remained a minority posture throughout — 9%, 5%, and 7%.

Round 3 improved versus Round 2, but did not return to a clearly normal operating pattern.

Source: EMIR CEO surveys · Confidential · Not for redistribution

Operating Posture & Impact — Sector Rankings

Mar 4 → Mar 25, 2026

OPERATING POSTURE SEVERITY (0=Normal · 3=Full Crisis)

OPERATING IMPACT SEVERITY (0=Low · 10=High)

Sector Risk & Resilience Metrics

All metrics 0–100 · Higher = more of the metric shown

* Labour Tolerance: higher value = longer ability to avoid workforce reductions

EMIR'S RESILIENCE MATRIX

#

SECTOR

CLASSIFICATION

DEMAND OUTLOOK

1

Government & Not-for-Profit

More Resilient

Public administration, regulation, utilities support, aid delivery: stable to up. Non-essential programmes, events, outreach: softer.

2

Healthcare & Pharmaceuticals

More Resilient

Hospitals, primary care, pharmacy, chronic meds, emergency care, mental health: up or stable. Elective, cosmetic, medical tourism-linked care: down.

3

ICT

Resilient

Cybersecurity, cloud, telecoms, business continuity, infrastructure: up. Hardware upgrades, discretionary IT projects, adtech-linked spend: softer.

4

Professional Services

Resilient

Legal, risk advisory, market intelligence, restructuring, crisis comms, strategy, compliance: up. Discretionary advisory, brand projects, long-horizon transformation work: slower.

5

Financial Services

Resilient

Payments, treasury, insurance, risk advisory, trade finance: stable to up. Consumer lending, wealth flows, transaction banking tied to tourism/property: softer.

6

Heavy Manufacturing & Construction

Moderately Resilient

Defence-linked, infrastructure maintenance, essential industrial inputs: stable. Private construction, fit-out, speculative projects, new starts: delayed.

7

Energy, Agriculture, Chemicals & Mining

Moderately Resilient

Energy security, fuel distribution, food supply, essential chemicals: stable to up. Export-sensitive volumes, non-essential industrial demand: mixed to softer.

8

Education

Moderately Resilient

K-12 core enrolment, essential training, online delivery: softer but stable. Executive education, overseas student flows, premium enrichment, events: down.

9

Transport, Mobility & Logistics

Exposed

Domestic freight, essential logistics, warehousing: holds better. Air travel, cross-border passenger flows, discretionary mobility, port-sensitive trade: down.

10

Retail & Consumer Products

Exposed

E-commerce, supermarkets, pharmacy-adjacent, value retail, staples: stable to up. Luxury, discretionary retail, big-ticket consumer goods, mall footfall-led spend: down.

11

Advertising, Media, PR & Entertainment

Highly Exposed

Crisis comms, reputation management, public affairs: up. Brand campaigns, events, entertainment, discretionary media spend, experiential: sharply down.

12

Real Estate

Highly Exposed

Affordable residential leasing, logistics assets, defensive commercial: holds better. Luxury residential sales, off-plan, hospitality real estate, foreign-buyer demand: down.

13

Travel & Tourism

Severely Exposed

Inbound tourism, airlines, hotels, tour operators, MICE, leisure attractions and high-end F&B: sharply down. Domestic staycations and essential travel: only a partial cushion.

Executive Sentiment Is Finely Balanced, Not Fearful

Overall, how would you describe your current sentiment regarding the regional conflict and its business implications?

OPTIMISTIC 28%NEUTRAL 42%PESSIMISTIC 30%

TAKEAWAY

Two points separate pessimism from optimism. No cohort is tipping into outright distress.

The dominance of the neutral camp signals an emerging “watch-and-position” mode rather than a directional swing in conviction. Sentiment is hardening only at the margin — executive opinion is split, not capitulating.

Operating Posture Remained Elevated

What operating posture are you currently in?

What Changed.

Partial crisis

eased a bit, equal to the regional figure.

Normal operations

rose in Riyadh from 23% to 30%, and now sits above regional’s 19%.

Full crisis

has stayed minimal in Riyadh (2%, one firm) and remains a minority across the region (9%).

HEADLINE: CEOs in KSA are recalibrating toward operating continuity.

Operational Impact Is Diffusing, Not Deepening

On a scale from 1 to 10, to what extent is the regional conflict impacting your ability to operate?

The Story.

Severe impact (7–10)

in Riyadh has dropped from 42% to 25%, indicating an improvement.

Moderate (4–6)

thickened from 31% to 41%. The centre of gravity has moved toward the middle.

KSA now sits below the regional view

on severe operational impact (25% vs 39%).

Where Pressure Has Built Most

Since the conflict began, where has pressure increased most? (Riyadh)

58%

Freight / logistics

30%

Customer demand

28%

Insurance cost or availability

25%

Input / commodity costs

25%

Counterparty payment risk

19%

Talent mobility

17%

Board / shareholder / HQ scrutiny

Where The Stress Lives.

Freight & logistics dominates (58%)

— the single largest pressure point reported by Riyadh CEOs.

The next tier:

customer demand (30%), insurance cost/availability (28%) and input/commodity costs (25%).

Lower-order pressures:

counterparty payment risk (25%), talent mobility (19%) and board/HQ scrutiny (17%).

Containment Eases, Financial Defences Harden

KSA Round 1 → Round 2 trajectory with regional benchmark — which measures have you implemented?

KSA R1 KSA R2 Regional

EASING · CONTAINMENT-PHASE MEASURES

Direct-response controls being unwound 4–5 weeks in

Emergency risk reporting to the board

58% 60% 53%

Restrictions on business travel

81% 57% 77%

Crisis committee

56% 51% 48%

Remote work

65% 45% 82%

HARDENING · FINANCIAL DEFENCE

Capital, hiring and spending levers scaling up as duration extends

Freeze new hires

16% 34% 49%

Freeze discretionary spending

21% 25% 42%

Liquidity buffer

14% 23% 36%

Freeze major capex

14% 21% 36%

Freeze salary increases

5% 15% 26%

Reduce capex

2% 15% 26%

Recessionary contingent planning

9% 13% 21%

Investment Plans Have Hardened

How has this regional conflict altered your 12-month investment plan?

Where The Book Is Moving.

Hard freezes have tripled in KSA.

Major pause/freeze rose from 5% to 15%, with significant reductions tripling from 2% to 6%. Regional major pause/freeze is nearly double KSA’s latest (28% vs 15%).

“No impact” is shrinking.

Down from 23% to 15% — fewer firms are unaffected. The middle is moving.

The investment book is being actively managed, not passively held.

The Trigger Window Has Stretched

At what duration of instability would your organisation trigger cuts to investment plans?

THE COLLAPSE

51%

↓

15%

Within 3 months

Short-horizon trigger (1–3 months) collapsed from a majority view to a minority view in five weeks.

Decision triggers have redrawn into the medium term: 3–6 months doubled (19%→40%), 6–12 months tripled (9%→23%), and a new 12-month+ bucket captures 9%. Riyadh CEOs are signalling materially greater patience than at war onset.

The Demand Pulse: Riyadh Softer Than Dubai

Recent demand (past 4 weeks) & forward outlook (next 4 weeks)

Demand Over The Past 4 Weeks

CURRENT DEMAND

Riyadh demand has held up better.

Only one in three Riyadh CEOs (34%) reported decreased demand over the past 4 weeks. Across the region, decreased demand was reported by 61% of CEOs — almost double. Stable demand sits 13pp higher in Riyadh.

Forward Demand Outlook (Next 4 Weeks)

FORWARD OUTLOOK

But forward conviction is closing the gap.

55% of Riyadh CEOs now lean negative on the next 4 weeks — much closer to regional’s 78% outlook. Notably, no Riyadh CEO reported a more positive outlook than 4 weeks ago. The signal is converging across the Gulf.

The 2026 Revenue Outlook Has Darkened

Expected impact of the conflict on 2026 revenues, if it persists at the current intensity

The Bifurcation.

The middle is hollowing out.

Flat fell from 21% to 11%; mild decline (1–9%) softened from 21% to 15%. Both displaced into firmer decline buckets.

Severe decline rose.

Decline of 20%+ now captures 30% of CEOs in KSA, up from 23% in March. A new 40–49% tail entry has emerged.

EXPECT REVENUE DECLINE

76%

KSA R2

67%

KSA R1

84%

REGIONAL

EXPECT FLAT REVENUE

11%

KSA R2

21%

KSA R1

10%

REGIONAL

EXPECT REVENUE GROWTH

13%

KSA R2

12%

KSA R1

7%

REGIONAL

Source: EMIR BBE Saudi Q2 2026 War Survey · KSA (Riyadh) Round 1 (March) & Round 2 (April) · Confidential

Global Outlook

The duration and scale of the conflict will shape the global outlook

April 2026 (preconflict) April 2026 (reference forecast) Adverse scenario Severe scenario January 2026

Source: IMF, April 2026 World Economic Outlook; and IMF staff calculations.

Cumulative 2026–27 GDP Growth Revisions

Apr 2026 vs. Jan 2026 · percentage points

Energy exporters Energy importers Conflict-affected

Source: IMF, World Economic Outlook; and IMF staff calculations.

Global Growth Outlook 2026

Before-war vs Latest IMF forecast · % real GDP growth · Source: IMF WEO Apr 2026

Region / Economy	Pre-war %	Latest %	Change (pp)

Global Growth — Regional Overview

Bubbles: IMF WEO Oct-25/Jan-26 vs Apr-26 · Country shading: selected year

Source: IMF WEO April 2026 · 193 economies · % real GDP growth

Real GDP Growth Trend

% real GDP growth · IMF WEO Apr 2026

FROM TO

Source: IMF WEO Apr 2026 · 2025–2028 = IMF forecasts

MENA Growth Outlook 2026

IMF Oct-25/Jan-26 vs Apr 2026 WEO · % real GDP growth

Economy	Pre-war %	Apr-26 %	Change (pp)

MENAT Growth

Real GDP growth · Source: IMF; EMIR

REAL GDP GROWTH 2026: Less than 2% 2–4% More than 4%

Purchasing Managers' Index (PMI)

50 = neutral threshold

FROM TO

Country	Jan 2026	Latest Available	Change

PMI Matrix

Bubble size = Nominal GDP 2026

Real GDP growth 2026: Less than 2% 2 – 4% More than 4% Nominal GDP 2026

Source: S&P Global; EMIR

Inflation — January Baseline vs Latest (% y-o-y)

Country-level actual CPI %

FROM TO

Country	Jan 2026 %	Latest %	Change (pp)

Inflation Matrix

Last 3m avg vs 12m change · colour = real GDP growth 2026 · Source: National sources; EMIR

Source: National sources; EMIR. Bubble colour = real GDP growth 2026 tier.

Inflation — IMF Forecast Revision (Pre-war vs Post-war)

IMF Oct 2025 WEO vs Apr 2026 WEO · Average annual CPI %

Economy	Pre-war %	Post-war %	Change (pp)	Direction

Pricing Strategy: Inflation Outlook

IMF WEO April 2026, Table A7 · Inflation % y-o-y

Source: IMF WEO April 2026, Table A7. Average = simple average of annual average CPI inflation, 2021–2025.

Current Account + Fiscal Position

IMF Oct 2025 WEO vs Apr 2026 WEO · % of GDP

Economy	CA Pre-war	CA Post-war	CA Δ	Fiscal Pre	Fiscal Post	Fiscal Δ

Fiscal Position — IMF WEO April 2026

Government debt vs fiscal balance · bubble size = nominal GDP

Source: IMF WEO April 2026 / IMF DataMapper; EMIR classification. Bubble size = nominal GDP 2026. Lebanon and Libya excluded (missing 2026 WEO variables).

GCC Sovereign Wealth Funds — AUM ($bn)

Standardised Global SWF AUM values · Latest available figures

By Fund

By Country (Stacked)

Figures are standardised Global SWF AUM values in $bn. Development vehicles NDF and ADFD excluded. ADQ included under L'IMAD following Jan-2026 consolidation.

Oil Revenues — Pre-war vs Post-war

Production, exportable volume, prices and gross revenue impact

Country	Pre-War Period				Post-War Period				Change
Country	Production (mb/d)	Exportable (mb/d)	Price ($/bbl)	Revenue ($mn/day)	Production (mb/d)	Exportable (mb/d)	Price ($/bbl)	Revenue ($mn/day)	Export Chg (mb/d)	Revenue Chg ($mn/day)

Source: EMIR · mb/d = million barrels per day