GCC Contract Awards fell sharply during the third quarter, reflecting growing pressure from geopolitical turmoil across the region. The aggregate value dropped 37.2% year-on-year to $47.4 billion during the three-month period.
The figure compares with $75.6 billion recorded during the same quarter last year. All six GCC countries recorded annual declines, although the regional performance improved slightly across the first nine months.
Oman recorded the largest annual decline during the quarter, with awards falling 96.6% year-on-year. The country recorded only $76 million in contracts during the period, according to the report.
Saudi Arabia remained the largest project market across the GCC during the quarter. The kingdom recorded $24.4 billion in contract awards, maintaining a significant lead over other regional markets.
The UAE followed Saudi Arabia with $15.6 billion in contracts awarded during the third quarter. Qatar ranked third with $5.2 billion in awards during the same period.
However, the quarterly comparison showed a broader slowdown across the regional project market. GCC contract awards declined 19.2% from the previous quarter, despite stronger performances from Qatar and Bahrain.
Qatar recorded a 76.1% quarterly increase in contract awards during the period. Bahrain also recorded growth, with awards rising 4.3% compared with the previous quarter.
Despite the sharp third-quarter decline, the broader nine-month picture remained comparatively stronger. Total GCC contract awards reached $204.1 billion during the first nine months of 2026.
That figure represented a 2.5% increase compared with the $199.1 billion recorded during the same period. The nine-month performance therefore provided some support despite the significant slowdown during the third quarter.
Geopolitical tensions have created additional challenges for governments and companies planning major regional projects. Disruptions affecting energy exports and trade routes have added uncertainty to project planning and investment decisions.
Attacks targeting energy infrastructure have also increased concerns surrounding regional economic activity. These disruptions could affect economic growth while placing additional pressure on government finances for planned projects.
Economic forecasts presented in the report point toward a difficult year for the GCC. The regional economy could contract 6.4% during 2026 before recovering with 5.8% growth in 2027.
The energy sector faces an even sharper contraction during the current year. Forecasts indicate that the sector could shrink 26.9% in 2026 before expanding 25.9% during 2027.
Saudi Arabia could experience a 4.6% economic contraction during 2026 under the cited forecasts. Meanwhile, the UAE economy could contract 1.5% during the same period.
Sector performance also showed significant differences across the regional project market. Of the eight sectors tracked, chemicals and gas were the only sectors recording annual growth.
Chemical-sector contract awards increased almost fivefold during the third quarter. The sector reached $3.5 billion, compared with $750 million recorded during the same period last year.
Gas-sector awards also increased considerably during the quarter. Awards climbed 59.9% to $13.5 billion, compared with $8.4 billion recorded one year earlier.
Construction continued to lead the regional market by total contract value during the quarter. However, construction awards dropped 44.7% year-on-year to $14.8 billion during the period.
GCC Contract Awards therefore showed a mixed performance across individual countries and economic sectors. Strong growth in chemicals and gas contrasted sharply with declines across construction and several national markets.
The quarterly decline highlights the impact that geopolitical uncertainty can have on major investment decisions. Nevertheless, the nine-month increase suggests that overall project activity remains relatively resilient despite recent disruptions.
The regional outlook will depend partly on developments affecting energy markets, trade routes, and infrastructure security. Government financing capacity and economic conditions will also influence project awards during upcoming quarters.
The figures indicate that regional project activity has not disappeared despite the third-quarter contraction. Instead, investment has shifted unevenly across countries and sectors amid a challenging economic environment.
GCC Contract Awards could therefore remain sensitive to geopolitical developments during the remainder of 2026. At the same time, stronger activity in selected sectors could provide support for regional project markets.
