Natixis · Alicia GARCIA HERRERO · 09/01/2026
Middle East Weekly Tracker - Diplomacy Continues While Military Attacks Return
Official source ↗The report
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AI analysis
AI-generated from the report above · not a translation and not the institution's wording · verify against the official source
Key arguments
- Diplomacy remains open while military attacks returned, with both Washington and Tehran signaling they did not seek a return to full-scale war.
- Brent futures rose from USD84/bbl to USD89/bbl as renewed fighting rebuilds the Hormuz risk premium.
- GCC CDS were broadly stable, with Bahrain remaining the most stressed.
- GCC equities were mixed: Kuwait and Oman rose, while Abu Dhabi, Saudi Arabia and Bahrain fell on direct attack risk and thinner fiscal cover.
- Foreign outflows eased to USD64mn from USD124mn, with investor sentiment cautious rather than outright risk-off.
- Hormuz traffic remains severely constrained, with another tanker hit by projectiles while leaving the Strait.
Risks
- Escalation of the conflict could lead to a full-scale war, despite signals to the contrary.
- Continued attacks on shipping could further disrupt Hormuz traffic and escalate the risk premium.
- A diplomatic breakthrough could reduce the oil risk premium more quickly than expected.