Global Oil Supply at Risk as Gulf Leaders Convene on Regional Stability

Roughly one-fifth of the world’s oil passes through the Strait of Hormuz, a waterway just a few kilometers wide. That single fact frames everything on the agenda at the third Hili Forum, which convenes in Abu Dhabi on September 7-8 under the theme “Gulf at Crossroads: Conflict, Consequences and Course Correction.” More than 1,000 participants from over 35 countries, including more than 55 speakers, are gathering to examine how ordinary citizens across the Gulf and beyond are exposed to the consequences of a region in strategic flux.

The forum, organized by the Emirates Center for Strategic Studies and Research in partnership with the Anwar Gargash Diplomatic Academy, brings together the Secretary-General of the Gulf Cooperation Council and experts from Gulf and international think tanks across more than 20 discussion sessions. Their central task is to help Gulf states chart a path through one of the region’s most strategically ambiguous periods in decades, with unresolved tensions between the U.S. and Iran, failed Arab-Israeli peace prospects, and the Strait of Hormuz transformed from a routine maritime corridor into a focal point of geopolitical rivalry.

The stakes for the public are direct. Gulf states have built a development model over decades rooted in stability, openness and East-West connectivity, one that funds infrastructure, employment and the social contracts that citizens depend on. That model now faces a security test that could redefine everything. The challenge is not merely protecting borders and military installations but safeguarding the development model itself in an environment where war, drones, missiles, maritime corridors, sanctions and supply chains have become interconnected elements of a single strategic equation.

The fundamental question confronting the region has shifted. For decades, Gulf policymakers asked how to maintain the stability that allows oil, gas, investments and trade to flow. Today that question has changed. Maintaining stability is no longer the sole requirement; the goal now encompasses building resilience, preserving what has been achieved, and advancing the development agenda. This represents a fundamental shift in strategic thinking, not a fleeting phase.

Recent developments have demonstrated that periods of de-escalation do not signify the end of conflict. Temporary understandings between Tehran and Washington can quickly collapse in the face of deeper disputes over Iran’s nuclear program, sanctions, the status of the Strait of Hormuz and the future of regional deterrence. The latest escalation between the U.S. and Iran, including an exchange of strikes and disagreements over the terms for returning to previous understandings, has shown that the crisis remains open to multiple potential scenarios.

This state of attrition poses a greater risk to Gulf populations than either a short war or a clearly defined settlement. Open warfare has its rules and peace has its institutions, yet the gray zone between the two creates a persistent drain on economic, security and political resources. Markets grow anxious, insurance companies more conservative, supply chains more costly. Regional governments face the simultaneous burden of funding defense, economic diversification and alternative infrastructure, pressures that ultimately shape what public services can deliver.

The Strait of Hormuz sits at the center of this vulnerability. Recent fighting has demonstrated that mines, drones, missiles and small boats can turn this narrow stretch of water into a problem for the entire global economy. Forum experts concluded that the lesson lies not merely in how to reopen the strait but in how to diminish any party’s ability to hold shipping lanes hostage for strategic leverage.

Meeting that challenge requires accelerating the development of alternative pipelines, expanding ports on the Red and Arabian Seas, increasing storage capacities, building more resilient energy grids and investing in maritime protection systems. Economic diversification will not suffice as long as export arteries remain concentrated around a single chokepoint.

Meanwhile, the nature of modern warfare has exposed a critical gap in regional security. The region has spent hundreds of billions of dollars over recent decades on state-of-the-art aircraft, air and missile defense systems and military technology. Yet owning weaponry does not equate to possessing an integrated security system. Low-cost drones can deplete stockpiles of expensive interceptor missiles. A cyberattack can cripple infrastructure without a single shot being fired. A low-tech naval mine can disrupt a corridor through which massive trade passes, with consequences felt in fuel prices, goods availability and economic stability for citizens far from the conflict zone.

The strategic transformation therefore extends to building an interconnected Gulf defense system encompassing early warning capabilities, joint air and missile defense, cybersecurity, maritime security, intelligence and critical infrastructure protection. This requires regional states to assess shared threat levels, exchange information and make decisions in real time.

The relationship with the United States remains central to forum discussions. Washington maintains the largest military presence in the region and remains the most important defense partner for several Gulf states, with capabilities that cannot be quickly replaced. It is neither pragmatic nor realistic to envision Gulf security in isolation from Washington. Even so, the structure of that relationship is likely to evolve, with signs emerging of reduced over-reliance on the U.S. security umbrella and a greater balance between robust strategic partnership and the Gulf’s own capacity for self-defense and autonomous security decision-making.

Europe’s role in the regional security equation remains disproportionately small given its economic and political weight. The participation of the EU Special Representative for the Gulf region in the Hili Forum was significant within an agenda addressing the roles of various powers and partners in the emerging order. Europe now recognizes that Gulf security is not a distant concern; any prolonged disruption to energy supplies or trade in the region rapidly impacts the European economy, drives up inflation and casts a shadow over industry and supply chains. The coming phase requires the Gulf-European relationship to shift from general political dialogue to more serious cooperation in maritime security, defense, cybersecurity, energy and technology.

China’s position presents an inherent contradiction. Beijing is a key economic partner for Gulf states and a major importer of regional energy, with a direct interest in the stability of the Strait of Hormuz. Yet its foreign policy avoids assuming the security commitments historically shouldered by the U.S. Gulf states therefore face a crucial reality: China can serve as a strategic economic partner, but it does not yet represent a security alternative to Washington. The coming phase could offer an opportunity to encourage Beijing to contribute more significantly to regional stability through diplomacy, investments in alternative corridors, energy security and the safeguarding of free trade and navigation.

Any party seeking to benefit economically from Gulf stability will increasingly face a difficult question: what will it contribute to maintain that stability? The new strategic identity of Gulf states, as the forum frames it, should assert independence from any specific axis. This does not imply neutrality in the traditional sense but rather positions them as “middle powers” with the resources, relationships and mediation capabilities that allow for greater latitude in shaping their choices. A multiplicity of partnerships, however, must not devolve into strategic ambiguity. A clear distinction must be maintained between the diversification of relationships and a lack of vision.

The imperative today is not merely to manage the Iranian crisis but to consider its consequences for the citizens and communities that depend on regional stability. Whether the confrontation concludes with an agreement, a truce, or persists in a gray zone of neither war nor peace, the Gulf that emerges from this phase must not be the same Gulf that entered it. The premise the Hili Forum places before the region is not how to return to the pre-war status quo but how to construct a new order that renders future conflict less likely and ensures that the cost of such conflict is less capable of crippling the region’s future.