Friends, colleagues,
Now is a small window of respite for the region—and for me.
The tense US-Iran ceasefire is still holding and the Israeli bombs have finally stopped in Lebanon.
I have spent the past several weeks covering the US-Iran War on the ground, under the constant threat of Iranian missiles and drone barrages. My war reporting included a long road-trip across the Gulf. (The highlight? A stopover at the Columns of Rajajil and Marid Castle in Jawf on my 15-hour drive from Riyadh back to Amman- more to come on that from my Instagram)
One thing has become clear from my travels across the Gulf and in conversations with policymakers and observers across the region: even before a negotiated settlement ending the US-Iran War is reached and as oil tankers struggle to pass through the Hormuz, the post-conflict Middle East is already taking shape.
It is not the New Middle East we all expected.
The first sign is the newly emerging regional economic model.
As I reported this week in The Christian Science Monitor, Arab Gulf states are in a race to Iran-proof their economies and territories. A total of $290 billion in alternate gas and oil pipelines, rail and freight projects, and Red Sea logistics hubs are being launched or accelerated, with a bid to divert 50%-80% of oil and gas away from the Strait of Hormuz, robbing Iran of key leverage.
The price tag of the Iran War for the Gulf has been staggering: Iran’s drone and missile strikes have caused $25-$58 billion in damage to gas and oil infrastructure; Qatar alone has been robbed of 20% of its liquid natural gas exports for the next five years.
Even should the Strait of Hormuz reopen today, the IMF reports that the economies of Qatar, the UAE, Bahrain, and Kuwait will contract to the tune of tens of billions of dollars. The IMF has downgraded its forecasts for the Middle East’s economic growth from 3.6% prewar to 1.1%.
Meanwhile, the 40 days of heavy Iranian missile and drone barrages did not drive Gulf states closer to Israel.
On the contrary, Arab Gulf states have emerged from the conflict, having absorbed 80% of Iranian attacks, bruised and distrustful of an Israel they saw as launching a war they had advocated against—and constantly trying to drag them in further.
Even Abraham Accords signees told me they warily see Israel as a would-be hegemon with expansionist ambitions across the region, not too dissimilar from Iran. Some Gulf officials say they believe Israel’s far-right government, and perhaps segments of the Israeli security apparatus, seek to weaken the Gulf along with Iran and Turkey to establish unquestioned supremacy in the region.
Meanwhile, an arms race is apace in the Middle East. Gulf states are in a bidding war to get more anti-missile and anti-drone systems and radar from South Korea, the UK, and further afield amid a US backlog of orders. Ukraine has signed defense pacts with Saudi Arabia, Jordan, the UAE, and Qatar to provide drone defense systems and offensive drone capabilities.
Saudi Arabia is in talks with Türkiye to learn from the Turkish military industry and localize its own missile production, Saudi officials tell me.
New alliances are also being forged. This war pushed together GCC states, which only months ago were on divergent paths highlighted by a bitter split between Saudi Arabia and the UAE over Sudan and Yemen. Now, talks are underway in Doha, Riyadh, and Abu Dhabi to integrate Gulf missile and drone defense systems, and to nationalize key pillars of their military industries.
A post-Iran security order is shaping up, with Pakistan playing the role of mediator and also a defense guarantor for Gulf states. Türkiye is set to hold talks in Antalya alongside a diplomacy forum this week to form a new defense bloc of Saudi Arabia, Türkiye, Pakistan, and Egypt.
Saudi Arabia, the UAE, Kuwait, and Qatar say they are not abandoning the US security umbrella, but are rapidly diversifying their defenses to prepare for a future living next to a hostile Iran.
The results are clear: Iran has failed to drive Arab Gulf states away from the US, in the same way that Israel has failed to drive them into its camp.
Instead, a new Moderate Middle is forming as Arab Gulf states, Jordan, and Syria strengthen diverse ties with Pakistan, Türkiye, and the EU—with the tacit support of Washington.
Gulf officials told me during my recent road trip across the Gulf that they still envision a region of cooperation, integration, and normalized ties with all. But they believe it is up to Israel and Iran to change their behavior and regional ambitions to integrate into this new region.
It remains to be seen whether the far-right, confrontational, and militarily expansionist powers in Tehran and Tel Aviv will moderate. But it is clear that a new regional order is shaping up that threatens to leave both Israel and Iran behind.
I will spend the rest of 2026 charting and detailing this new Middle East order, with updates every two weeks.
Thank you for sticking with me on a journey through a region whose fate affects us all.
Be safe, be well, be aware,
-Taylor
Visit thetaylorluck.com for my latest stories and reports.
The contents of this newsletter do not reflect the views of Taylor Luck's employers or affiliated organizations.
