AGP Executive Report

US Inflation & Energy Pass-Through: US annual inflation jumped to 4.2% in May, the highest in three years, with energy costs driving the rise as the Iran conflict keeps oil and fuel prices volatile. Iran-US MoU Talks: Iran’s foreign ministry says the US-Iran memorandum of understanding is “almost finalized” but not signed, with Tehran warning US claims about timing/location are speculative. Hormuz Fuel Flow: Gulf refined-fuel exports are rebounding as more tankers slip through the Strait of Hormuz, easing supply pressure for diesel, gasoline and naphtha—though not back to pre-war levels. Retail Fuel Controls (India): India restricted bulk diesel purchases from retail pumps (200 litres per customer) and capped diesel sales, aiming to stop diversion and shortages for everyday consumers. Retail Fuel Controls (Middle East-linked): Saudi lifted a five-year ban on Lebanese imports, a sign of improving Gulf-Lebanon trade ties after years of sanctions and political friction. Healthcare Consumer Impact (UAE): SEHA’s Madinat Zayed Hospital used advanced endoscopy to remove a long-buried feeding tube in a high-risk patient, avoiding major surgery. Tech for Consumers (KSA/UAE): Garmin expanded its ECG App to Saudi Arabia and the UAE for compatible smartwatches. Competition & Consumer Markets (OTS): Turkic states’ competition forum began in Shusha, focusing on regional cooperation to strengthen fair market practices.

Iran-US Deal Talks & Hormuz: Pakistan’s PM says a final peace-deal text has been agreed and work is underway to finalize next steps, even as US and Iranian officials trade conflicting claims about what’s actually settled. Oil & Consumer Impact: With the Strait of Hormuz still sensitive, the US says military help is moving about 7 million barrels a day out of the Arabian/Persian Gulf, while refined-fuel exports from the Gulf are rebounding but remain far below pre-war levels—keeping fuel-price pressure front and center for households. Inflation & Shopping Mood: US inflation jumped to 4.2% in May (energy-led), but consumer sentiment improved in June as gasoline eased; still, shoppers remain worried about stubborn inflation. Local Retail Pressure: California’s petroleum watchdog says branded fuel pricing is adding extra pain for households, and Pakistan’s budget plans face rising public frustration as petrol costs surge. Sustainability & Retail Innovation: UAE launched Naseej, a national textile circularity initiative aimed at cutting waste and reshaping fast-fashion consumption. Luxury Consumer Culture: Van Cleef & Arpels unveiled “Fascinating Egypt,” a high-jewellery collection bringing ancient motifs into a modern luxury spotlight.

Middle East Energy Shock: Oil prices slid again after Trump said a US-Iran peace deal could be signed soon, but Iran pushed back that no final conclusion is reached—keeping Strait of Hormuz risk and shipping uncertainty front and center. Fuel Retail Rules: India moved to curb bulk fuel diversion by restricting petrol and diesel bulk purchases at retail outlets for 90 days, capping high-speed diesel sales per customer and pushing institutions to captive pumps. Inflation Pressure: The US reported May inflation at 4.2% (highest in three years), with energy costs driving the jump; Trump linked the rise to efforts tied to Iranian oil. Eurozone Rate Watch: The ECB signaled it’s ready to hike again next month if the Middle East shock keeps spreading into core inflation. UK Growth Hit: UK GDP contracted 0.1% in April, blamed on Iran-war fuel and shipping disruptions. Consumer Tech Luxury: GoldPrivé launched bespoke 24K gold iPhone 17 Pro Max customizations, betting on demand for status-driven electronics. Egypt Trade Support: Egypt’s MSMEDA partnered with EXBY to help export-ready SMEs reach new international markets. Agriculture Input Risk: Turkey warned fertilizer supply risks are rising as Hormuz disruptions strain sulfur and other key inputs. Luxury Retail Insight: A report suggests luxury store expansion is shifting toward bigger cities with more prime space, putting pressure on smaller hubs.

Inflation Shock: US CPI jumped to 4.2% in May, the highest in three years, with energy costs driving the rise; Trump doubled down that he “loves the inflation” tied to Iran-war oil moves, while markets watched for relief if tensions cool. Policy Pivot: The ECB raised rates for the first time since 2023 to tame Iran-war inflation pressure, even as it warned eurozone growth risks. Oil & Consumer Impact: Oil prices swung on Iran headlines—rallies on renewed strikes and Hormuz fears, then drops after Trump said planned strikes were canceled—showing how quickly fuel shocks feed household costs. Shipping Disruption: The Strait of Hormuz crisis is stranding about 20,000 sailors in the Persian Gulf, with the IMO warning the route is unsafe and pushing for evacuation corridors. Gulf Trade Signals: Saudi Arabia lifted its five-year ban on Lebanese imports, a thaw that could ease regional consumer supply pressures. Turkey Rates: Turkey’s central bank held its policy rate at 37%, citing inflation trends and conflict monitoring. Retail Demand Watch: Turkey’s Mavi reported Q1 profit down as consumer demand stayed soft amid macro uncertainty. Energy Supply Shift: US LNG and LPG shipments to India rose as Iran-war disruptions cut Gulf flows, reshaping fuel availability for consumers. Local Prices: Gold fell in Egypt despite a modest global rebound, pressured by a stronger dollar and yields.

AI Shopping Habits: A Visa study says 91% of Egyptians use AI while shopping, mainly for price comparisons and product ratings, though only 38% trust it to handle payments. Retail & Dining Expansion: Americana Restaurants and carpo opened the first carpo store in Qatar, pushing premium nuts, chocolates and coffee into the local luxury food retail scene. Regional Trade Signals: Saudi Arabia lifted a roughly five-year ban on Lebanese imports, a move tied to rebuilding ties and easing pressure on Lebanese exporters. Air Travel Under Strain: Wizz Air profits plunged 99% after Iran-war route cancellations and Middle East disruptions, while Emirates was named “Best Overall Airline in the Middle East” at the APEX awards. Inflation Pressure: Egypt’s headline inflation eased to 13% in May, but US consumer inflation hit 4.2% as energy costs surge amid the Iran conflict. Consumer Safety & Services: IndiGo issued a Middle East travel advisory, urging passengers to monitor flight status amid heightened tensions. World Cup Economy: Early World Cup match times in Türkiye are expected to boost breakfast demand for cafés, bakeries and delivery services. Creative Media Partner: Ooredoo Palestine appointed Adpro& Group and Adpro& OMD as integrated creative and media partners. Finance & Rates: The ECB is set to hike rates to curb Iran-war-driven inflation in the eurozone.

Inflation Shock: US CPI jumped to 4.2% in May, the highest in three years, with energy costs tied to the Iran war driving gasoline up 40.5% and fuel oil up 58.9%, squeezing household budgets and rattling markets. White House Pushback: Trump dismissed the data, saying “I love the inflation,” while claiming the US is secretly moving Iranian oil through the Strait of Hormuz—an assertion that keeps pressure on prices and fuels political backlash. Energy Supply Jitters: The Strait remains disrupted as the US and Iran trade strikes; the DOE offered more Strategic Petroleum Reserve barrels, while oil and fuel prices stayed volatile. Consumer Spending Resilience: Despite higher costs, NRF reported May retail sales rose for the eighth straight month as shoppers prioritize essentials. Middle East Consumer Ripple: Fertiliser and food-price risk is rising as conflict lifts fertiliser costs; EU officials warned of potential food shortages without longer-term supply fixes. Retail/Brand Watch: Moss CEO warned of possible price rises for spring formalwear amid ongoing Middle East conflict. EU Deal Scrutiny: The EU will probe Middle Eastern funding in Paramount Skydance’s Warner Bros Discovery bid, a reminder that Gulf capital is reshaping consumer media assets.

Geopolitics & Consumer Costs: Renewed US-Iran clashes are pushing up energy prices and freight risk, with the Red Sea and Hormuz routes again in focus—bad news for shipping, retail supply, and household budgets across the region. Retail & Travel Demand: UK travel retailer WH Smith slashed its profit forecast and launched an equity raise, blaming Iran-war travel disruption and weaker passenger spending at airport and rail shops. Inflation Watch (Egypt): Egypt’s annual headline inflation eased to 13% in May, but food and key services still drove pressure, including big jumps in housing-related costs and telecom. Energy Partnerships (Egypt-Kuwait): Egypt is pursuing deeper KPC cooperation to expand oil and gas work across exploration, production and digital transformation. Property & Retail Footprint (Egypt): ElRaay Developments launched its River Park residential project in Obour City, adding retail and medical units alongside EV charging and community amenities. Food Security & Trade (Saudi-Russia): Saudi Arabia and Russia signed $1.28bn deals focused on agricultural and food security, including veterinary vaccine localisation and poultry supply chain expansion. Markets & Risk Appetite: Tokyo and South Korea stocks fell sharply on renewed Middle East tensions, while China’s exports still grew strongly in May, supported by AI-linked demand. Crypto Sanctions (Iran): The US Treasury sanctioned Iran’s Nobitex crypto exchange, targeting its role in military-linked transactions.

Energy Shock & Supply Disruption: Qatar halted LNG output and Saudi shut a major refinery after strikes tied to the Israel-Iran escalation, while the Strait of Hormuz remains a key risk for global oil and gas flows. Oil & Consumer Prices: Oil slid on ceasefire hopes but remains volatile; U.S. gas prices are easing in some places even as analysts warn supply risks could quickly reverse gains. Crypto & Sanctions: The U.S. Treasury sanctioned Iran’s Nobitex crypto exchange, targeting a major channel used to support military-linked transactions. Health & Food Fads: Saudi health authorities warned against the “Tayyibat Diet” after cases of patients landing in intensive care for stopping insulin. Retail & Payments: Kuwait’s stc partnered with TOD to stream FIFA World Cup 2026 matches for subscribers, while Egypt’s Thndr/EGX developments point to continued fintech and market-access expansion. Aviation & Travel: IATA expects airline profits to halve amid Middle East conflict and fuel costs, but Gulf carriers are seen as relatively resilient. Markets & Macro: Gold steadied on ceasefire hopes, though strong U.S. jobs data kept rate-hike expectations elevated.

Sanctions & Crypto: The US Treasury sanctioned Iran’s Nobitex crypto exchange, alleging it helped the IRGC-Quds Force bypass sanctions—another sign of how conflict is reshaping consumer-adjacent finance and payments. Middle East Conflict & Consumer Costs: Renewed Israel-Iran strike fears are again rattling prices and travel plans, with reports of consumers delaying bookings and airlines facing profit pressure from fuel costs. Dubai Real Estate: BEYOND Developments unveiled its AED4bn “The Yards” masterplan in City of Arabia, launching the first residential cluster Arancia—an example of continued UAE supply growth even as buyers demand better-finished homes. Gulf Worker Gifting: Arabian Flora is rolling out cross-border Father’s Day delivery via local florists across 10 countries, targeting GCC migrant families who can’t travel. AI for Midsize Businesses: Algebra AI launched in Dubai after a $7m funding round, aiming to deliver managed AI systems for Gulf sectors including food & beverage and manufacturing. Turkey Inflation: Türkiye’s consumer inflation eased to 32.61% in May, a key read-through for retail pricing and household budgets. Retail Fuel Shift: Fuel stations are evolving into mobility hubs with EV charging, alternative fuels, and digital payments—pushing new consumer convenience expectations across the region.

Sanctions & Payments: The U.S. Treasury sanctioned Nobitex, Iran’s biggest crypto exchange, accusing it of helping the IRGC-Quds Force route transactions and evade sanctions, freezing assets under U.S. jurisdiction. Middle East Tensions & Consumer Impact: Israel and Iran appeared to pause strikes after trading fire, but both warned retaliation if provoked—keeping pressure on prices and supply chains. Energy Costs for Everyday Shoppers: Iraq’s CPI rose 4.3% year-on-year in April, while fuel-price volatility tied to Middle East disruption continues to ripple into consumer budgets. Aviation Relief: Canada offered airlines up to $150m in jet-fuel loans, aiming to protect connectivity as fuel costs surge from the Hormuz-linked disruption. Retail & Spending Behavior: U.S. retailers say shoppers are still spending, but are subtly changing habits—fewer store visits and more cutbacks, especially among lower-income customers. Local Market Watch: Changan’s DEEPAL EV brand launched in Oman, adding new-energy models to the consumer choice mix. Trade & Shipping Risk: The EU imposed its first “freedom of navigation” sanctions on Iran-linked entities over Hormuz transit threats, signaling tighter maritime risk for regional commerce.

Sanctions & Crypto: The U.S. Treasury sanctioned Iran’s Nobitex crypto exchange, alleging it helped the IRGC-Quds Force route transactions around sanctions—another reminder that financial tools are getting pulled into the Iran-Israel conflict. Consumer Pressure: In the U.S., retailers say shoppers are still spending, but they’re quietly changing habits—more careful fuel stops and fewer discretionary trips—while economists warn retrenchment could widen once refunds fade. Aviation Cost Shock: IATA warned airline profits could be cut in half in 2026 as jet fuel costs jump about 40% from the Iran war, with Middle East airspace disruptions and delivery delays compounding the squeeze. Egypt Retail & FMCG Expansion: Lipton Teas & Infusions opened a new Alexandria production line, boosting automated packaging capacity as Egypt pushes investment-friendly reforms. Egypt Trade Support: Egypt appointed Hatem El Nawawy to lead the Export Development Authority to expand the exporter base and help Egyptian products reach new markets. Payments Upgrade: Backbase teamed with Mastercard to embed Mastercard Move into its AI banking platform, aiming to speed up cross-border payments for banks. Private Jet K-Shape: Private jet travel is rising despite the war-driven fuel hit, as wealthy travelers keep booking while lower-income groups tighten budgets.

Middle East Conflict Escalation: Israel struck Beirut’s southern suburbs days after a U.S.-brokered ceasefire began, killing at least two and injuring dozens, as Iran warned of wider retaliation and mediation efforts for a broader deal face new strain. Aviation Costs Hit Consumers: IATA says the Iran war is slashing airline profitability, with African carriers forecast to earn just $0.40 per passenger in 2026 as fuel costs soar and rerouted traffic fails to offset expenses. Retail Spending Pressure: U.S. convenience-store and restaurant traffic is showing early cracks as higher fuel and broader inflation squeeze budgets, pushing consumers toward fewer “frills” and more price-sensitive choices. Energy Shock Ripple Effects: Reports across the U.S. show fuel prices staying volatile amid Middle East shipping disruptions and refinery outages, reinforcing how regional conflict quickly feeds into everyday household costs.

Local Product Push in Sharjah: Kalba’s market debuted Jebel Deem products—grapes and pickled olives—showcasing Sharjah’s push to back local agriculture and diversify what’s sold in city markets. Iran War’s Consumer Shock: With the conflict hitting 100 days, the Strait of Hormuz remains a major bottleneck, keeping energy costs high and feeding inflation pressures across households and businesses. Oil & LPG Cost Pressure: India raised domestic LPG by ₹29 per 14.2kg cylinder (second hike in three months), while global fuel volatility tied to West Asia tensions continues to ripple into everyday budgets. Aviation Retail Impact: Airlines and travel firms are warning customers about higher costs and operational disruptions; IATA flagged fuel volatility and inflation as top risks, while Jet2 adjusted when holiday documents are issued amid Middle East uncertainty. Gulf Trade & Logistics: Analysts warn a longer Hormuz closure could force a structural reset of supply chains and costs, reshaping regional trade routes. Sanctions Hit LPG Smuggling: The US Treasury sanctioned a network disguising Iranian LPG as Omani gas, targeting front companies and tankers used to ship to Asia. Food & Exports Angle: Iran’s World Cup excitement is muted by hardship, while regional agriculture stories continue—like fresh pineapple exports reaching the UAE—showing how consumer demand still finds openings despite the wider turmoil.

Egypt–Trade & Logistics: Egypt launched Canal Trust Ship Services to run specialized commercial vessels linking Egyptian Red Sea ports (starting with Safaga) to East African markets, bundling shipping agency, customs clearance, and inland warehousing to speed perishable exports. South Asia Growth Watch: India’s GDP grew 7.8% in Jan–Mar 2026, beating forecasts on resilient services, industry and construction—though Middle East war risks are already clouding the rest of the year. Energy Prices & Consumer Impact: US fuel prices stayed volatile as Middle East tensions and shipping disruptions kept pressure on crude and gasoline; local reports for the week ending May 30 showed lowest regular gas as low as $3.55/gal (Pawnee County) and diesel lows around $4.19/gal (Mobile County), underscoring how geopolitics can quickly filter into everyday costs.

Gulf Security Shock: The U.S. says it shot down four Iranian drones aimed at the Strait of Hormuz and then struck Iranian coastal radar sites; Iran’s IRGC retaliated with missile attacks on U.S.-linked targets in Kuwait and Bahrain, warning of wider disruption if escalation continues. Sanctions & Consumer Impact: The U.S. Treasury hit Iran’s shadow LPG shipping and “shadow banking” networks, while Iran’s banking customers report unexplained missing funds—both moves underline how conflict and finance pressure can quickly spill into everyday costs. Energy & Retail Supply: Iraq is turning to home solar as blackouts worsen, and Japan’s shelves are seeing “color” changes as Middle East-linked fuel and petrochemical price pressure forces packaging redesigns. Gulf Defense Spending: The U.S. approved a $1.98B anti-drone weapons sale to Kuwait as regional air defenses brace for more attacks. Pharma Cooperation: Saudi Arabia’s SFDA signed an MoU with Russia to strengthen drug regulation, inspections, and quality systems. Turkey Trade Watch: Turkey is positioning itself to benefit from EU fashion sustainability rules, pushing traceability and circular production as compliance tightens. Tech & Privacy: A former Tinder executive joined Israeli startup Mine to expand privacy and AI governance—timely as regulators and customers demand tighter data handling.

Trade & Consumer Costs: The US moved to cut tariffs on heating/cooling (HVAC) and key industrial/agricultural machinery, lowering rates to 15% (from 25%) and setting 10% for products with at least 85% US metals—aimed at easing price pressure on manufacturers, farmers and households. Middle East Conflict & Energy Prices: Oil eased after US-Iran diplomatic signals, but the standoff stayed tense as Iran linked any broader peace to a Lebanon ceasefire and Strait of Hormuz access; Lebanon’s leaders also rebuked Tehran for treating the country as a “bargaining chip.” Fuel Prices & Logistics: The Middle East crisis continues to ripple into retail energy costs and shipping—fuel price spikes are hitting consumers and raising freight/logistics costs ahead of major shopping periods like Amazon Prime Day. Retail & Spending Watch: South Africa’s early-2026 retail growth held up on softer inflation, but forecasts warn the relief window may close as Middle East-driven input costs return. Business Moves: Weatherford agreed to buy NCS Multistage, expanding well-completion capabilities with growth focus in Middle East unconventional gas. Regulatory/Policy: Japan approved an extra $19bn budget to cushion households from Middle East-linked fuel and utility costs.