Qatar faces the most severe economic shock in the Gulf region, with its banking system under pressure; the sovereign wealth fund may become a key defense.

⑴ The Iranian attack has resulted in damage to 17% of Qatar's liquefied natural gas export capacity, with a repair period of up to five years and an annual revenue loss of approximately $20 billions. Capital Economics predicts that, due to this impact and the ongoing attacks, Qatar's GDP may shrink by 13% in 2026, making it the most affected economy in the Gulf region. Unlike Saudi Arabia and the UAE, Qatar lacks pipeline transportation capacity, and its liquefied natural gas exports rely entirely on the now-blocked Strait of Hormuz. ⑵ Qatar's banking system is particularly sensitive to external financing. By the end of 2025, Qatar's banks will have net external debt of $120 billions, equivalent to one-third of domestic loans. S&P Global's stress test shows that if 50% of cross-border interbank financing and 30% of non-resident deposits are withdrawn, the country's banks will face a shortage of saleable assets. During the 2017 trade blockade, Qatar injected $40 billions into the banking sector to stabilize the situation. ⑶ Qatar still possesses multiple buffer tools. The central bank holds $18 billions in gold reserves, nearly double the size compared to last year. The Qatar Investment Authority, a sovereign wealth fund with assets of $580 billions, holds equity stakes in European blue-chip stocks such as Volkswagen, Glencore, and Barclays, as well as core London properties including Harrods, Heathrow Airport, and Canary Wharf. If the Gulf conflict continues to escalate, the fund may liquidate some strategic assets to stabilize finances.