Many global equity investors have historically held limited positions in Middle Eastern countries, which barely registered in emerging market benchmarks. But new investment opportunities are drawing attention as transformation of the region accelerates.

Since the global pandemic ended, rising oil prices have flooded the Middle East with cash. From a low of less than $20 per barrel in 2020 to a peak of more than $120 per barrel in 2022, oil revenues have boomed. But this has also raised questions about how long the region’s dependence on fossil-fuel income can continue.

In fact, the Middle East is already actively moving away from its reliance on hydrocarbons. Led by Saudi Arabia and the United Arab Emirates (UAE), this transformation has included strategic initiatives and investor-friendly reforms that offer potentially meaningful opportunities for equity investors.

SAUDI ARABIA DIVERSIFIES

Saudi Arabia’s non-oil revenue, represented