Trump’s new trial in the Middle East

31 January 2025

 

This package also includes: Trump 2.0 targets technology


Donald Trump’s return to the US presidency on 20 January 2025 is anticipated to have profound impacts on the Middle East, focused on two key areas: US relations with Iran, and the interrelationship between the US, Israel and other regional actors.

Nevertheless, while the broad thrust of Trump’s goals in the Middle East is clear, the way he is likely to go about achieving them is hard to anticipate, with the mercurial president liable to shift his approach on a whim.

Iranian relations

The US’ relations with Iran, where Trump’s position appears to have softened in recent months, is a case in point.

While Trump was initially expected to reinstate a “maximum pressure” campaign of sanctions against Iran, he has lately made a series of nuanced statements. In October, he said: “I would like to see Iran be very successful. The only thing is, they can’t have a nuclear weapon.”

Although the US president has previously hinted at leveraging threats of force against Iran to compel it to restrain its nuclear and military capabilities, he has also hinted at avoiding a military approach and conspicuously sidelined US neoconservatives with harder stances on Iran within his administration.

A softer stance would also fall more in line with Trump’s historic aversion to US military entanglement, as well as his preference for negotiation and deal-making.

The region is furthermore in a different place than it was in Trump’s first term. Back then, he was supported by Saudi Arabia and the UAE, but now those same Gulf allies have moderated their oppositional stances towards Iran and turned towards a more cooperative, business-oriented path forward.

There is no way to predict exactly how US relations with Iran are likely to play out over the course of Trump’s second term, but there could be significant room for manoeuvre for an Iranian government willing to put out the right signals and give the US president the symbolic wins he craves.

Israel agenda

One inevitable constant of US relations in the region is Washington’s largely unconditional backing for Israel, and Trump’s administration is expected to reaffirm his support for Israel.

The president’s first term was a triumph for pro-Israel policymakers in Washington, with Trump breaching long-standing US holding patterns of diplomatic ambiguity by recognising Jerusalem as Israel’s capital and normalising the Israeli occupation of the Syrian Golan Heights.

Trump also oversaw the signing of the Abraham Accords that normalised Israeli relations with the UAE, Bahrain, Sudan and Morocco, with the expectation that this diplomatic progress would continue.

Before the onset of the latest war in Gaza in late 2023, Washington had reportedly been on the cusp of finalising a normalisation agreement with Saudi Arabia. The threat of this pending deal with Riyadh was one of the key triggers for Palestinian militant groups in Gaza to attack Israel on 7 October.

With the inauguration of Trump, there is every indication that the US administration intends to pick up where the deal with Saudi Arabia left off, as well as to potentially shift US policy in other key areas as well, such as its stance on the legitimacy of Israel’s illegal occupation of the West Bank.

In terms of brokering an agreement with Riyadh, Washington may encounter friction. After October 2023, the Saudi negotiations team indicated that it was keen to proceed with a deal with the US, while leaving the matter of relations with Israel aside, but this may not be to Washington’s taste.

Saudi Arabia’s official position on normalisation has since hardened considerably, with Saudi Foreign Minister Faisal Bin Farhan Al-Saud repeatedly stating this past year that there can be no normalisation without the realisation of Palestinian statehood. 

This firm position on Palestinian statehood could he hard for Riyadh to pull back from given the current geopolitical tensions in the region. There are nevertheless signs that the Trump administration is still eager to pursue renewed negotiations on the matter of normalisation with Saudi Arabia.

For the moment, the most pressing question for the region is whether Trump will continue to pressure Israel to abide by the terms of the ceasefire in Gaza, as well as its commitment to withdraw its troops from southern Lebanon.

The president has laid partial claim to the Gaza ceasefire and expressed his hope that it will proceed to fruition in its second and third phases. 

He has also affirmed Israel’s need to withdraw from southern Lebanon – yet there the timeline has already slipped, raising the possibility that Trump, like Biden, could be soft on implementation.

There is no way to predict exactly how US relations with Iran are likely to play out

Transactional approach

More ominously, on 27 January, Trump mooted the possibility of “cleaning out” the population in Gaza by relocating 1.5 million Palestinians to Egypt and Jordan. Cairo and Amman have promptly dismissed the notion amid a storm of criticism over the unprincipled proposal.

The idea’s very suggestion by Trump points to a deeply transactional approach that jars with standing precepts of the Geneva Convention’s and international humanitarian law – which could cause problems down the road.

Looking ahead, the tenor of Trump’s engagement with the region in his second term is likely to be determined by his immediate reactions to these fast-moving geopolitical events. The Middle East presents major challenges that he will have to come to terms with in his first few months in office. 

Trump 2.0 targets technology


READ MEED’s YEARBOOK 2025

MEED’s 16th highly prized flagship Yearbook publication is available to read, offering subscribers analysis on the outlook for the Mena region’s major markets.

Published on 31 December 2024 and distributed to senior decision-makers in the region and around the world, the MEED Yearbook 2025 includes:

> GIGAPROJECTS INDEX: Gigaproject spending finds a level
https://image.digitalinsightresearch.in/uploads/NewsArticle/13353127/main.gif
John Bambridge
Related Articles
  • Ora Developers adds land bank to its Bayn masterplan

    17 April 2026

    Egyptian firm Ora Developers has signed a land acquisition agreement with Abu Dhabi-based developer Modon Holding to acquire an additional 4.8 million square metres (sq m) of land in the Ghantoot area between Abu Dhabi and Dubai.

    Ora Developers said that the land acquisition will increase the existing Bayn masterplan from 4.8 million sq m to 9.6 million sq m.

    The firm added that the total investment in the masterplan upon completion is expected to reach AED30bn ($8bn).

    In January, Ora Developers appointed six engineering consultancies to lead the development of the first phase of its Bayn residential community project.

    The developer appointed UK-based firm Mace to lead the overall project management.

    Canadian firm WSP will serve as the masterplan, infrastructure, landscape and water bodies design consultant, as reported by MEED in May last year.

    Another US firm, Aecom, will provide construction supervision services.

    Hong Kong’s 10 Design is the project’s architectural concept design consultant.

    Local firm Dewan Architects & Engineers is the project’s design consultant and architect of record.

    The UK’s Currie & Brown is the cost consultant.

    The first phase will offer 805 villas and townhouses, and the project is expected to be completed in 2028.

    The project will also include a neighbourhood park, sports facilities, a water park, a five-star hotel and a shopping mall.

    In December last year, Abu Dhabi government-owned contractor NMDC Group won a AED142m ($39m) contract from Ora Developers.

    The contract scope covers the execution of enabling works on the Bayn masterplan.

    The main construction works on the project's first phase are expected to begin in the second quarter of this year.

    https://image.digitalinsightresearch.in/uploads/NewsArticle/16439214/main.jpg
    Yasir Iqbal
  • SAR extends deadline for Riyadh section of Saudi Landbridge

    16 April 2026

     

    Saudi Arabia Railways (SAR) has set a deadline of 29 April for a design-and-build contract for the construction of a new railway line, the Riyadh Rail Link, which will run from north to south Riyadh.

    The tender was issued on 29 January. The previous bid submission deadline was 29 March.

    The scope of work includes constructing a 35-kilometre-long double-track railway line connecting SAR’s North-South railway to the Eastern railway network.

    The contract also covers the procurement, construction and installation of associated infrastructure such as viaducts, civil works, utility installations, signalling systems and other related works.

    The project is expected to form a key component of the Saudi Landbridge railway.

    In January, SAR said it will deliver the Saudi Landbridge project through a “new mechanism” by 2034, after failing to reach an agreement with a Chinese consortium for the construction of the project, as MEED reported.

    In an interview with local media, SAR CEO Bashar Bin Khalid Al-Malik said the consortium failed to meet local content requirements and that the project will now be delivered in several phases under a different procurement model.

    The project has been under negotiation between Saudi Arabia and China-backed investors keen to develop it through a public-private partnership.

    Al-Malik said that the project cost is about SR100bn ($26.6bn).

    It comprises more than 1,500 kilometres (km) of new track. The core component is a 900km new railway between Riyadh and Jeddah, which will provide direct freight access to the capital from King Abdullah Port on the Red Sea.

    Other key sections include upgrading the existing Riyadh-Dammam line, a bypass around the capital called the Riyadh Link, and a link between King Abdullah Port and Yanbu.

    The Saudi Landbridge is one of the kingdom’s most anticipated project programmes. Plans to develop it were first announced in 2004, but put on hold in 2010 before being revived a year later. Key stumbling blocks were rights-of-way issues, route alignment and its high cost.


    MEED’s April 2026 report on Saudi Arabia includes:

    > COMMENT: Risk accelerates Saudi spending shift
    > GVT &: ECONOMY: Riyadh navigates a changed landscape
    > BANKING: Testing times for Saudi banks
    > UPSTREAM: Offshore oil and gas projects to dominate Aramco capex in 2026
    > DOWNSTREAM: Saudi downstream projects market enters lean period
    > POWER: Wind power gathers pace in Saudi Arabia

    > WATER: Sharakat plan signals next phase of Saudi water expansion
    > CONSTRUCTION: Saudi construction enters a period of strategic readjustment
    > TRANSPORT: Rail expansion powers Saudi Arabia’s infrastructure push

    To see previous issues of MEED Business Review, please click here
    https://image.digitalinsightresearch.in/uploads/NewsArticle/16418597/main.gif
    Yasir Iqbal
  • Public Investment Fund backs Neom

    16 April 2026

    Commentary
    Colin Foreman
    Editor

    Register for MEED’s 14-day trial access 

    Saudi Arabia’s Public Investment Fund (PIF) has backed Neom by including it as one of six strategic ecosystems in its newly approved 2026-30 strategy.

    The future of the $500bn gigaproject had been thrown into doubt following the postponement of the 2029 Asian Winter Games at the Trojena mountain resort, the cancellation of construction contracts – such as the $5bn deal with Italian contractor Webuild for dam works at Trojena – and the slowdown of development at The Line, where tunnelling contracts were cancelled and staff left the project.

    The backing comes as Neom’s operational focus appears to be evolving in response to shifting regional dynamics and global economic conditions. For example, on 15 April Neom posted on its official X account about a new Europe-Egypt-Neom-GCC corridor, describing it as a faster route for time-sensitive goods. It said the corridor combines trucking and ferry services to move goods quickly into the Gulf, adding that importers from several European markets are already using it to reach the UAE, Kuwait, Iraq, Oman and beyond.

    Powered by Pan Marine, DFDS and regional RoPax services, the initiative is positioned as a way to add flexibility and resilience to regional supply chains. This emphasis on logistics and immediate trade utility suggests a shift away from the more speculative architectural announcements that characterised Neom’s early years, towards activity more directly tied to current market realities.

    PIF’s broader 2026-30 strategy places heavy emphasis on “delivering competitive domestic ecosystems to connect sectors, unlock the full potential of strategic assets, maximise long-term returns and continue to drive the economic transformation of Saudi Arabia”.

    The inclusion of Neom as a standalone ecosystem within the Vision Portfolio suggests that while the project remains part of the kingdom’s Vision 2030 goals, it will be subject to the fund's focus on working with the private sector.

    That means the long-term success of Neom will increasingly depend on its ability to attract external investment and function as a viable economic hub rather than just a state-funded construction site.


    MEED’s April 2026 report on Saudi Arabia includes:

    > COMMENT: Risk accelerates Saudi spending shift
    > GVT &: ECONOMY: Riyadh navigates a changed landscape
    > BANKING: Testing times for Saudi banks
    > UPSTREAM: Offshore oil and gas projects to dominate Aramco capex in 2026
    > DOWNSTREAM: Saudi downstream projects market enters lean period
    > POWER: Wind power gathers pace in Saudi Arabia

    > WATER: Sharakat plan signals next phase of Saudi water expansion
    > CONSTRUCTION: Saudi construction enters a period of strategic readjustment
    > TRANSPORT: Rail expansion powers Saudi Arabia’s infrastructure push

    To see previous issues of MEED Business Review, please click here
    https://image.digitalinsightresearch.in/uploads/NewsArticle/16417262/main.jpeg
    Colin Foreman
  • Kuwait gas project worth $3.3bn put on hold

    16 April 2026

     

    State-owned Kuwait Gulf Oil Company’s (KGOC’s) planned tender for the development of an onshore gas plant next to the Al-Zour refinery has been put on hold due to uncertainty created by the US and Israel’s war with Iran, according to industry sources.

    The project budget is estimated to be $3.3bn, and the last meeting with contractors to discuss the project took place in Kuwait on 10 February.

    Previously, it was expected to be tendered in late March, but the tendering process was delayed due to the regional conflict and disruption to shipping through the Strait of Hormuz.

    One source said: “This tender is now effectively on hold while KGOC waits for increased stability in the region before it invites companies to bid for the contract.”

    Under current plans, the plant will have the capacity to process up to 632 million cubic feet a day of gas and 88.9 million barrels a day of condensates from the Dorra offshore field, located in Gulf waters in the Saudi-Kuwait Neutral Zone.

    Ownership of the field is disputed by Iran, which refers to the field as Arash.

    Iran claims the field partially extends into Iranian territory and asserts that Tehran should be a stakeholder in its development.

    It is believed that the Dorra field’s close proximity to Iran will make development difficult due to the current security environment.

    The offshore elements of the project are expected to be especially difficult to protect from attacks from Iran.

    In July last year, MEED reported that KGOC had initiated the project by launching an early engagement process with contractors for the main engineering, procurement and construction tender.

    France-based Technip Energies completed the contract for the front-end engineering and design.


    READ THE APRIL 2026 MEED BUSINESS REVIEW – click here to view PDF

    Economic shock threatens long-term outlook; Riyadh adjusts to fiscal and geopolitical risk; GCC contractor ranking reflects gigaprojects slowdown.

    Distributed to senior decision-makers in the region and around the world, the April 2026 edition of MEED Business Review includes:

    > GCC CONTRACTOR RANKING: Construction guard undergoes a shift
    To see previous issues of MEED Business Review, please click here
    https://image.digitalinsightresearch.in/uploads/NewsArticle/16413221/main.png
    Wil Crisp
  • Iraq pushes to revive oil pipeline through Saudi Arabia

    16 April 2026

    Iraq is pushing to revive an oil pipeline that passes through Saudi Arabia, allowing it to diversify export routes.

    Saheb Bazoun, a spokesman for Iraq’s Oil Ministry, said the pipeline would help to insulate Iraq from any future blockades of the Strait of Hormuz, which has been largely closed since 28 February.

    The original pipeline through Saudi Arabia has not been used for more than 30 years and would need work to be done in order to bring it online.

    It is 1,568km long, extending from the city of Zubair in Iraq to the Saudi port of Yanbu on the Red Sea.

    The pipeline was built in two phases during the 1980s. The first phase stretches between Zubair and Khurais, while the second extends to Yanbu. The pipeline’s operating capacity reached over 1.6 million barrels a day (b/d).

    Following the Gulf War, the pipeline was shut down in August 1990. It has remained out of operation for decades, despite Iraq’s several attempts to restart it.

    The original pipeline project cost over $2.6bn, including storage tanks and loading terminals.

    In the wake of the US and Israel attacking Iran on 28 February, global markets have lost 11 million barrels a day (b/d) of oil supply due to the effective closure of the Strait of Hormuz.


    READ THE APRIL 2026 MEED BUSINESS REVIEW – click here to view PDF

    Economic shock threatens long-term outlook; Riyadh adjusts to fiscal and geopolitical risk; GCC contractor ranking reflects gigaprojects slowdown.

    Distributed to senior decision-makers in the region and around the world, the April 2026 edition of MEED Business Review includes:

    > GCC CONTRACTOR RANKING: Construction guard undergoes a shift
    To see previous issues of MEED Business Review, please click here
    https://image.digitalinsightresearch.in/uploads/NewsArticle/16413290/main.jpg
    Wil Crisp