Saudi Arabia Reaps $210 Billion Windfall from Iran Conflict

Economist Robin Brooks of the Brookings Institution argues that Saudi Arabia is the only clear beneficiary of the ongoing conflict with Iran. His analysis highlights how the kingdom's oil revenues have surged despite initial export disruptions. Before the war, Saudi Arabia exported 7 million barrels per day (mb/d) at a Brent crude price of $60, generating roughly $150 billion in annual revenue. At the height of the conflict, exports dropped to 4 mb/d, but higher prices around $110 kept annualized revenues at $160 billion. Currently, with exports at 5.5 mb/d and Brent near $105, Saudi revenues have climbed to $210 billion, a $60 billion increase from pre-war levels.

Brooks notes that Saudi Arabia's nominal GDP averages around $1 trillion, making this windfall worth about 6% of GDP. He emphasizes that even if Brent prices fell below $75, the kingdom would still fare better than before the war. The East-West pipeline, which bypasses the Strait of Hormuz, prevented Saudi exports from reaching zero during the height of hostilities. Brooks supports the U.S. blockade of Iran, arguing it has caused the Iranian rial to collapse, which he views as a strategic advantage for Saudi Arabia and the UAE.

Meanwhile, U.S. military presence in the region has escalated, with reports of additional troops and carrier strike groups. President Trump has hinted at potential post-midterm escalation, though negotiations remain ongoing. Brooks suggests tracking three key indicators: Brent prices staying above $75, Saudi export volumes recovering, and whether the military buildup leads to strikes or a negotiated deal. He concludes that the longer the conflict lasts, the more it benefits Saudi Arabia.