TITLE:
Economic Instability in the Gulf Region: Insights from a Dual Shock
AUTHORS:
Talal A. N. M. S. Alotaibi, Lucía Morales
KEYWORDS:
COVID-19, Oil Price War, GCC, Stock Markets, Dual Shock
JOURNAL NAME:
Theoretical Economics Letters,
Vol.12 No.5,
October
18,
2022
ABSTRACT: The emergence of the COVID-19 pandemic has caused financial markets to
suffer historic losses during the first quarter of 2020, at levels unseen since
the crisis of the futures markets in 1987. The pandemic affected global markets
parallel to a simultaneous shock from the oil price war between Saudi Arabia
and Russia. As the global health crisis worsened, governments worldwide were
forced to take measures that led to economic lockdowns and significant economic
disruptions. This research paper examines the extent to which the dual shock impacted the GCC economies due to the critical
implications for the Gulf region because of its heavy reliance on oil. The core
findings show that the dual shock caused significant disruption in the GCC
stock exchanges, except for the case of Bahrain’s stock market, which emerged
as relatively stable.