Iran has said that it will target American and Israeli economic centres and financial institutions in retaliation to an attack on an Iranian bank a day earlier. 

A spokesperson for Khatam-al-Anbiya military command headquarters, said that “the enemy left our hands open to target economic centres and banks belonging to the United States and the Zionist regime in the region,” according to semi-official Tasnim News Agency. 

“The people of the region should not be within a one-kilometre radius of banks,” the spokesperson added. 

Bank Sepah, one of Iran's largest public lenders, came under attack when one of its Tehran-based branches was hit by a missile attack in the late hours of Wednesday night. 

Iran has also issued a list of major American tech giants with regional operations as ‘legitimate targets' for further attacks. 

The list includes offices and assets of tech colossi including those associated with Google, Amazon, Microsoft, Nvidia, IBM, Oracle and Palantir in Israel and around the region.

“With the expansion of the regional war into an infrastructure war, the scope of Iran’s legitimate targets gradually becomes broader,” the post read.

The Middle East has become a hotbed for global tech companies looking to build substantial local presence and ride the region's tech wave. Dubai has become an increasingly preferred destination for tech companies to advance the emirate's ambition of pushing deeper across diverse industries, including technology.

Microsoft operates a major office in Abu Dhabi while Dubai hosts regional headquarters for tech titans, including Meta and Google. 

American hyperscalers and tech giants including OpenAI, Oracle, NVIDIA have bet big on the GCC region, partaking in launching infrastructure and initiatives including Stargate, the next-gen AI infrastructure cluster within the 5-gigawatt UAE-US AI Campus, to serve companies operating within 2,000 miles of the UAE's border. 

However, the region’s digital infrastructure has been increasing susceptible to Iranian attacks in recent days. Three AWS data centres in the UAE and Bahrain sustained drone attacks last week, prompting digital banking and connectivity outages that lasted several days. 

The GCC data center market holds immense potential, looking to double from $3.48 billion in 2024 to $9.49 billion by 2030, fuelled by cloud computing, AI demand, and 2030 initiatives in Saudi Arabia and UAE.

The Securities and Exchange Commission of Pakistan (SECP) has approved the country’s first independent Shariah screening mechanism for securities listed on the Pakistan Stock Exchange, allowing a private firm to conduct compliance assessments for investors and market participants.

The approval has been granted to Al-Hilal Shariah Advisors Pvt Limited, enabling the company to independently screen listed securities and publish Shariah-compliant lists based on its approved methodology.

According to SECP, the move introduces an alternative regulatory pathway under the Shariah Governance Regulations 2023. It is intended to broaden participation in Shariah-compliant investment services while encouraging competition in the Islamic capital markets segment.

Previously, Shariah compliance screening for listed companies was carried out by the Pakistan Stock Exchange in partnership with Meezan Bank Limited and Al Meezan Investments.

As of December 31, 2025, 308 out of 535 securities listed on the Pakistan Stock Exchange are classified as Shariah-compliant, representing 63% of the market’s total capitalization. These companies account for Rs12,373 billion of the exchange’s total market value of Rs19,679 billion, according to SECP.

Under the new approval, Al-Hilal Shariah Advisors will apply a screening methodology based on the latest available financial information and predefined criteria to include or exclude securities from the Shariah-compliant list.

The regulator said the initiative could also support the development of new Islamic equity indices within Pakistan’s capital market. However, any such index will require coordination with the Pakistan Stock Exchange before it can be launched.

SECP added that Shariah-compliant securities lists will now be updated and published quarterly, replacing the previous six-month screening cycle used for compliance reviews.

Indonesia has signed four recognition agreements with certification bodies across Philippines, Mexico and China, to expand its international halal recognition framework. 

The agreements were forged with China Halal Certification Shanghai Co., Ltd., Shenzhen One Gate Halal Centre, Halal Development Institute of the Philippines, and Aseguramiento Halal, S.A. de C.V, according to state-owned news agency Antara. 

Ahmad Haikal Hasan, head of the Indonesian Halal Product Assurance Agency (BPJPH) said that the move is part of a strategy to strengthen the harmonization of Indonesian halal standards with global trading regions. It also strengthens the compatibility of local halal product assurance systems in the international market.

"Cross-border recognition is important to facilitating the flow of halal products, providing business certainty, and expanding market access for industry players," he said.

The recognition simplifies cross-border trade in halal products by eliminating the need for multiple certification procedures in each importing country, reducing costs, accelerating product distribution times, and increasing industrial competitiveness, Hasan added. 

With broader international recognition, BPJPH seeks to develop a halal trade system that is increasingly standardized, transparent, and integrated across countries.

Deputy Ambassador and Consul General of the Philippine Embassy to Indonesia, Gonaranao B. Musor, said the mutual recognition reflects the two countries' commitment to strengthening halal trade cooperation within a government-to-government framework.
 

The Islamic Development Bank Institute (IsDBI) has received a US patent for a blockchain consensus mechanism known as Proof-of-Use (PoU), a system designed to support digital financial services and expand innovation in the Islamic fintech sector.

The mechanism allows participants to validate blockchain transactions based on their level of activity on the network rather than computing power or financial stake. IsDBI said the model is intended to encourage wider participation in digital finance while improving efficiency and reducing energy consumption.

Alternative to existing blockchain models

Blockchain networks typically rely on consensus systems such as Proof-of-Work or Proof-of-Stake to validate transactions and maintain security.

Proof-of-Work, used by cryptocurrencies such as Bitcoin, requires powerful computers to solve complex mathematical problems, a process that consumes large amounts of electricity. Proof-of-Stake allows participants who hold larger quantities of tokens to play a greater role in transaction validation.

In contrast, the Proof-of-Use model gives users validation authority based on their participation in the network. Participants verify each other’s transactions, with activity levels determining their ability to validate blocks.

According to IsDBI, the approach reduces energy consumption and lowers barriers to entry by removing the need for specialised hardware or large financial holdings.

Potential applications in Islamic fintech

The institute said the model could support a range of digital financial services aligned with the principles of Islamic finance, including fairness, transparency and broader access to financial services.

Potential applications include cross-border payment systems, trade finance platforms for small businesses, digital identity systems for unbanked populations, and blockchain-based tools for charitable giving and halal investment.

By linking validation power to usage rather than ownership, the system is designed to reduce concentration of control within blockchain networks and encourage participation from a broader base of users.

Part of broader digital finance strategy

IsDBI said the patent forms part of its wider strategy to promote innovation in financial technology across its member countries. The organisation is exploring partnerships with technology developers and financial institutions to test and deploy the Proof-of-Use model in practical applications.

While further work is required to test scalability and security, the institute said the new mechanism could help support digital financial infrastructure in markets where access to conventional banking services remains limited.

The initiative reflects growing interest among development institutions in using blockchain technology to expand financial inclusion and improve the efficiency of digital financial services.

The blockage of the Strait of Hormuz in response to escalating military conflict following US and Israeli air strikes on Iran, is expected to weaken credit quality across Middle East's vital sectors. 

Several areas of activities, including trade and supply routes, energy and capital flow and tourism are expected to come under strain, according to a study published by S&P Global Ratings. 

Oil prices have surged in the wake of the crisis, with Brent crude oil prices having climbed 11% over the past five days, and nearly 30% since the beginning of the year. 

While higher oil prices are expected to bring some short-term relief to GCC government budgets, it is contingent on whether those barrels can be exported. 

“The extent of obstructions to key trade routes or to production have the potential to induce fiscal strain through weakened revenues, which could be particularly relevant for governments with weaker balance sheets, larger banking systems and limited export options,” the credit rating agency added. 

Oman, the UAE, and Saudi Arabia can partially mitigate the impact through alternative export routes for part of their volumes. Despite alternate routes, Qatar relies on the strait as does Jordan, witj 40% of its exports heading to the Middle East, scaling their exposure to regional trade disruption. Meanwhile, Kuwait is highly reliant on the Strait as an export route, according to S&P. 

The Strait of Hormuz, one of the world’s most strategically vital chokepoints, is a narrow waterway that connects the Persian Gulf and the Gulf of Oman to the Indian Ocean for maritime traffic. Approximately a fifth of the world’s oil passes through the waterway, which is roughly 30 miles wide at its narrowest point.

The conflict has escalated the risk of capital outflows for regional financial institutions, and while the duration of hostilities will determine the volume of the outflows, Bahraini and the Qatari banking systems have the largest net external debt position and may require external or government support.

“We classify four out of the six GCC governments as highly supportive of their private-sector commercial banks. in the unlikely event of a banking crisis, there is a high likelihood of extraordinary government support to these banks,” S&P said in a February report.  

However, the conflict could last for weeks, according to US President Donald Trump. The barrage of Iranian drones and missile strikes have targeted military instalments and well as key digital infrastructure, including three AWS data centres in the UAE and Bahrain, leading to multiple digital services outages. 

Customers in the UAE have faced mobile banking outages as the toll of the protracted crisis widens to impact local lenders. 

Capital markets across the region fell on their first day of trading since the conflict broke out. Saudi’s Tadawul All Share Index plunged between 4.8% at the open on Sunday. Dubai Financial Market fell 4.7% on Wednesday, its first day of trading, while Abu Dhabi Securities Exchange plunged 1.9%, with lenders, property firms and utilities leading the losses. 
 

Pakistan’s National Assembly has passed the Virtual Assets Bill, 2026, formally legalising cryptocurrencies and establishing a regulatory framework for digital assets in the country’s financial system.

The legislation, introduced by Minister for Parliamentary Affairs Dr Tariq Fazal Chaudhry, had previously been approved by the Senate earlier this year. It provides for the creation of a specialised regulatory authority responsible for licensing, supervising and regulating virtual assets and virtual asset service providers (VASPs).

According to the government, the bill recognises virtual assets as an increasingly significant component of the global financial system and seeks to introduce oversight aimed at improving investor protection, transparency and market stability.

Under the new framework, the proposed authority will oversee digital asset trading platforms, support the development of Pakistan’s blockchain and cryptocurrency sectors, and strengthen safeguards against financial crimes such as money laundering and fraud. The legislation also highlights the need to align with international regulatory standards and includes provisions for Shariah-compliant virtual asset services.

Analysts say the move could strengthen Pakistan’s position in the emerging digital asset market by providing legal certainty for investors and businesses operating in the sector. A formal regulatory structure may also encourage foreign investment and support the development of fintech innovation in the country.

The bill represents Pakistan’s first comprehensive attempt to integrate cryptocurrencies and other virtual assets into the country’s regulated financial ecosystem while balancing technological innovation with financial risk management.

UAE-based carriers Emirates and Etihad Airways have resumed limited operations as airlines seek to ease some congestion caused by airspace closures enforced by ongoing Iranian attacks. 

Dubai-based Emirates said it will resume a limited number of flights from the evening of March 2, prioritizing customers with earlier bookings. Etihad resumed flights from Monday, March 2, according to the airline’s website and Flightradar24 data. 

Emirates had said that all flights to and from Dubai remain suspended until 3pm local time on March 3, while Etihad Airways temporarily ceased operations until 2pm local time Tuesday.

Qatar Airways has also suspended operations due to closure of Qatari airspace, with a further update expected by 9am Doha time on March 4. 

Oman Air has announced that all flights to and from Amman, Dubai, Bahrain, Doha, Damman, Kuwait, Copenhagen, Baghdad and Khasab between March 4 to 6 have been cancelled. Barring the aforementioned flights, all other flights will operate as scheduled, though the carrier did warn of some possible delays. 

Airspace closures by GCC countries amid ongoing Iranian attacks were the most severe in recent times, leaving tens of thousands of travellers stranded in places such as Dubai and Doha.

Iran’s attack on Gulf countries has entered its third day, making flying a precarious pursuit, compounded further by the fog of war which has led to the inadvertent downing of US fighter jets in Kuwait. 

The UAE’s Civil Aviation Authority said that more than 20,000 affected passengers were supported through temporary accommodation arrangements and rebooking services. Dubai Airports, the authority that manages Dubai International (DXB) and Dubai World Central (DWC), confirmed that limited operations will resume Monday, permitting a select number of flights to operate from both facilities. 

Since the beginning of the conflict, flight cancellations across seven Middle Eastern airports -including Dubai's DXB and DWC, Abu Dhabi's Zayed International Airport, Doha's Hamad International Airport, Bahrain International Airport, Sharjah International Airport and Kuwait International Airport - have exceeded 12,300 in number, according to Flightradar24. 

More than 100,000 Britons have registered their presence in the Middle East with the UK government, part of around 300,000 people who are currently present across Gulf countries, including residents, holidaymakers and those transiting through.  

Aviation infrastructure across the Gulf region has come under siege with Iranian missiles and drones attacking critical architecture. DXB’s concourse took a minor hit with four people sustaining injuries. A drone attack struck Kuwait International Airport, leaving multiple people with minor injuries and causing damage to Terminal 1.

In an interview with CNN, the Qatari foreign ministry ‌spokesperson said that country intercepted Iranian attacks that targeted ⁠civilian infrastructure, ⁠including the international airport. 

Airlines around the world, from the UK and France to North America and Asia have axed flights to the Middle East amid mounting regional tensions.

Lufthansa suspended flights to Dubai until March 4 and to other cities including Tel Aviv, Beirut, Tehran and Amman, until March 8. British Airways halted flights to the Gulf, Israel and Jordan through mid-March while North American carriers, including Delta and United, have all paused Middle East operations. Air Canada has suspended all flights to and from Dubai and Tel Aviv until March 23.

Stock markets across the Gulf region opened to a jittery start on Sunday in first signs that the Iran-US conflict has impacted regional financial markets. 

Saudi’s Tadawul All Share Index (TASI) plunged roughly 4.8% at the open on Sunday, hitting a 35-month low before paring more than half of its loss, closing 2.18% lower. 

The benchmark index of Muscat Exchange fell 103.18 points from its previous day's close of 7393.37, amid a regional sell-off triggered by mounting tensions. 

Boursa Kuwait suspended trading on Sunday, citing exceptional circumstances. 

“Based on the decision of the Board of Commissioners of the Capital Markets Authority, and due to the exceptional circumstances, the country is currently experiencing Boursa Kuwait announces the suspension of trading effective 01-03-2026, until further notice,” a notice on Boursa Kuwait’s website read. 

The UAE’s financial regulatory authority also announced the closure of both its bourses - Abu Dhabi Securities Exchange and Dubai Financial Market – on March 2 and 3. The country has faced a barrage of drone and missile attacks over the weekend. 

The UAE Capital Markets Authority said that it would continue to assess the situation on an ongoing basis, taking any further measures as necessary.

Brent crude prices surged from Friday's close of $72.48 a barrel to $78.36 a barrel on Sunday, with the overall price having risen 16% over the past month. 

Felipe Elink Schuurman, CEO and co-founder at Sparta Commodities said that a softer oil price hike than the one anticipated over the weekend indicates a mere logistical disruption, not a supply one. 

“It is indeed surprising that most polls over the weekend were expecting a rise in flat price of $80 to $90 (a barrel]. It started off [Monday] morning at $81 but then it came down,” Schuurman said during a Gulf Intelligence podcast,. 

“For the time being, there is a sort of de facto closure of the Strait of Hormuz, mostly because of insurance companies putting in barriers or increasing their insurance coverage or trading companies not willing to take their vehicles through the Strait. So, it basically means that it is a logistical disruption but we have not yet seen any kind of supply disruption.” 

The Strait of Hormuz, one of the world’s most strategically vital chokepoints, is a narrow waterway that connects the Persian Gulf and the Gulf of Oman to the Indian Ocean for maritime traffic. Roughly 30 miles wide at its narrowest point, oil tankers carry approximately 20 million barrels of oil each day through the Strait.

“Oil markets have been the most visible expression of markets pricing in geopolitical conditions with Brent opening 12.5% higher,” wrote Edward Bell, acting group head of research and chief economist at Emirates NBD.

“Markets have since pared those moves as there is a renewed focus on diplomatic avenues but in the meantime, oil will be highly subject to headlines and in particular, the status of the Strait of Hormuz.”

Saudi Arabia’s budget deficit in the fourth quarter grew to its highest in five years, as reduced oil prices continue to weigh on state revenues. 

The kingdom's fourth quarter budget deficit rose to $25.3 billion (94.9 billion Saudi riyals) from $23.6 billion (88.5 billion Saudi riyals) recorded during the previous quarter and $15.3 billion (57.6 billion Saudi riyals) posted in the fourth quarter of 2024. 

The budget deficit brought the year’s total shortfall to $73.6 billion (276 billion Saudi riyals), which Riyadh has entirely funded through borrowing.  

Fourth quarter revenues slid to $41 billion (154 billion Saudi riyals) from $45.6 billion (171 billion Saudi riyals) recorded during a year-earlier period.

Oil and non-oil revenues rose over the previous quarter but dipped on an annual basis. Oil revenues slid 10% year-on-year to $41.1 billion (154.2 billion riyals) in the fourth quarter of 2025, alongside non-oil revenues which fell 7% to $32.7 billion (122.6 billion Saudi riyals).

Expenditures rose a nominal 3% over the previous year, with compensation to employees constituting up two-fifth, according to data shared by the Ministry of Finance.

“With oil prices well below the estimated fiscal breakeven level, Saudi Arabia has ramped up borrowing in international debt markets and diversified its funding sources, while also reassessing the pace and scale of major Vision 2030 projects to prioritize efficiency and private sector participation,” the MUFG report read.  

“While officials expect the deficit narrow to 3.3% of GDP this year, investors anticipate it will remain higher, reflecting persistent spending pressures and a challenging oil revenue environment.”  

The kingdom has been running budget deficits since 2022, as reduced oil revenues strain public finances. Brent crude, which serves as a benchmark for roughly two-thirds of the world's crude oil supplies, is hovering around $71 per against the backdrop of a substantial American military buildup in the Middle East. 

Saudi Arabia needs oil to be north of $92 per barrel this year and at $86.6 per barrel in 2026 to balance its books, according to the IMF.