Saudi markets not out of the woods, oil prices drop

The rally in Saudi Arabia’s stock market today has partially reversed the losses suffered since Jamal Khashoggi’s disappearance hit the headlines. But the threat of sanctions, coupled with falling oil prices, means that Saudi markets will stay under pressure. And we think that the recent dip in oil prices has further to run, which is a key reason why we think that the economic recovery in the Gulf will lose momentum from mid-2019. Finally, the past week has brought contrasting messages on reform prospects in Egypt and Morocco.