Gulf states shrug off dip in oil prices

On 21 June, the price of a barrel of Brent, Europe’s benchmark crude, dipped below $90 for the first time since December 2010. It fell on the back of poor economic signals from both the US and China, leading to speculation that Gulf Co-operation Council (GCC) states might consider cutting back on the huge spending programmes deployed to maintain political stability. By 15 July, however, Brent contracts were trading at around $100/bbl, pushed up by geopolitical tensions and the prospect of monetary easing programmes in the world’s two biggest economies. And even if prices were to fall again, the Gulf states seem relatively well insulated.