Qatar economy set to shrink nearly 9% as Iran conflict hits gas and blocks Hormuz

Qatar’s economy is set to contract by nearly 9% as the Iran conflict reverberates across the Gulf, with damage to gas infrastructure and a blockade of the Strait of Hormuz cited as key drivers of the downturn. For decades, the country supplied liquefied natural gas on time and without disruption, cementing its reputation as one of the world’s most reliable energy exporters.

Backed by the world’s third-largest gas reserves, the Gulf state built up extraordinary fiscal surpluses and accumulated sovereign net foreign assets worth 226% of GDP, according to Fitch Ratings. That track record — and the emirate’s self-styling as a safe haven for business in the region — has been shattered by the Iran conflict, which has heightened risks around vital energy infrastructure and shipping routes through Hormuz.

Amid the deteriorating outlook, the central bank has moved to support the sector as the forecast darkens.