Has the Iran-US war come to an end? Despite the signing of a memorandum of understanding on a peace deal, uncertainty prevails as negotiations continue to address the underlying causes of the conflict and lay the groundwork for a lasting peace agreement. However, what is certain is that energy and geography have both played pivotal roles in shaping the course of the conflict and its proposed solutions. An encouraging sign is the notable drop in oil prices, with Brent crude falling to around $75 per barrel by the end of June – the lowest level since early March 2026.
The Arab region, throughout its ancient and modern history, has never been immune to turmoil and conflict. Yet, for the past three decades, the Gulf region has stood out as an oasis of stability and development, and a place where aspirations to become a global hub for finance and energy have materialised. However, the current tensions in the Gulf have shattered this calm and order (again, due to energy and geography) and will redraw the map of the region.
One indicator of how this map is being reshaped is the ambitious plan to revive the historic 1,320-km Hejaz Railway. Last month, Saudi Arabia and Turkiye signed a MoU of cooperation on connectivity, which includes the Hejaz railway, which would connect Turkiye, Syria, Jordan and Saudi Arabia.
The move comes at a sensitive time for the region and sparks speculation that efforts are afoot to establish an alternative trade corridor that bypasses the volatile Strait of Hormuz. The cost to rebuild the railway is projected at a modest $100m. For the insurance industry, this represents new business and indicates that more is in the pipeline. A tectonic shift is taking place in the Arab world that will transform global risk profiles.
As the second half of the year begins, mid-year reinsurance renewals continue to show a downward trend in risk-adjusted prices across most global lines, with reinsurers more willing to provide protection at lower attachment points and for more frequent return periods, Fitch Ratings has noted. The ratings agency says that competition is likely to remain price-driven in 2026, with looser policy terms in forthcoming renewals, absent a major macro or sector-specific shock. Overall, the expectations are that the global reinsurers’ profitability is projected to decline but remain strong through the end of this year.
For the MENA region, however, underwriters are experiencing a dual reality: a broader market softening that mirrors global trends, but one that is strictly bounded by localised hardening in areas exposed to heightened geopolitical risk.
The regional volatility belies the Gulf’s tremendous insurance and reinsurance potential. Nowhere is this commercial potential more visible than in the region’s exploding pipeline of sports and mega-infrastructure projects.
This month will see the conclusion of the 2026 FIFA World Cup, the largest edition in its history with 48 teams competing and 104 matches. The next tournament in 2030 will be hosted by six countries, including Morocco, while Saudi Arabia, the sole host of the 2034 edition, is preparing a $27bn infrastructure programme. All in all, these large-scale investments will unlock substantial opportunities for the insurance industry.
Middle East Insurance Review (MEIR) wishes the MENA insurance industry a fruitful second half of 2026 and continued success following an eventful first half of the year. M
Osama Noor
Editor
Chief Representative
Middle East Insurance Review