By: Salman Rafi Sheikh -
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- Dubai Skyline, United Arab Emirates. Wikimedia Commons The next great Middle Eastern rivalry is not only between Iran and the Arab Gulf states. It is unfolding inside the Gulf itself with the United Arab Emirates’ April 28 decision to ditch the old geopolitical model.
For decades, the UAE and Saudi Arabia projected the image of a unified strategic axis: anti-Iran, anti-Islamist, pro-status quo, and closely aligned with Washington. That consensus is now fraying. Quietly but unmistakably, Abu Dhabi and Riyadh are drifting into aggressive competition over money, ports, trade routes, militias, diplomacy, and regional leadership. The old Gulf order, once built around Saudi primacy and Emirati economic support, is giving way to something far more unstable. The UAE is no longer behaving like Saudi Arabia’s junior partner. It is behaving like a rival, revisionist power, which Riyadh must tackle to maintain the status quo. Abu Dhabi’s New Regional Ambition More importantly, the UAE can afford to defy Saudi Arabia in ways few regional actors can. Riyadh needs high oil prices to sustain its economy and bankroll Mohammed bin Salman’s transformation agenda. According to IMF estimates, Saudi Arabia’s fiscal breakeven oil price is around US$90 per barrel. The UAE’s is below US$50. That difference changes everything. For Saudi Arabia, OPEC is both a geopolitical weapon and a fiscal necessity. For the UAE, it is increasingly a constraint. Abu Dhabi’s willingness to challenge Riyadh inside OPEC was never just about production quotas. It was a declaration that the UAE no longer sees Saudi Arabia as the unquestioned manager of Gulf economic order. The Emiratis believe they can survive lower oil prices far better than the Saudis can. Once the Iran war formally ends and energy markets stabilize, the UAE’s independent production strategy could fundamentally weaken Saudi leverage over global oil pricing.
Still, the UAE’s defiance is no longer limited to oil politics. Abu Dhabi is also losing patience with Saudi-dominated regional forums like the Gulf Cooperation Council and the Arab League. In unusually blunt remarks at a conference in late April, senior Emirati official Anwar Gargash openly mocked the weakness of Arab and Gulf states during the recent regional crisis. While the GCC provided logistical coordination, Gargash said its political and military position was “the weakest in history.” He added that he expected weakness from the Arab League but was “surprised” by the GCC’s paralysis. Ten years ago, such remarks would have been unthinkable. Today, they reveal something much bigger: the UAE no longer believes in the old Saudi-led Arab order. Abu Dhabi increasingly sees institutions built around Arab and Islamic solidarity as liabilities, not assets. Its future lies elsewhere — in ports, finance, artificial intelligence, and transactional alliances with global powers. Most importantly, it values its security ties with Israel more than with the Gulf states. It was Israeli air-defence systems that helped defend Dubai, not Saudis’. The UAE, therefore, is far keener to invest its money in Israeli defence firms than in any other regional defence networks (which do not exist as such). Israel, Iran, and the Fragmentation of the Gulf The Abraham Accords transformed the UAE-Israel relationship from quiet security coordination into an overt geopolitical partnership. Since then, economic, technological, intelligence, and defense cooperation between the two states has expanded rapidly. The recent Iran war accelerated this process.
For the UAE, the conflict was economically devastating. Regional instability disrupted aviation, shipping, tourism, and investment flows that are central to Dubai’s global business model. Emirati leaders concluded that survival in an increasingly volatile Middle East required stronger security integration with Israel and closer strategic coordination with Western powers. Saudi Arabia, however, appears more cautious.
Riyadh has certainly moved closer to Israel behind the scenes, particularly on intelligence and security matters related to Iran. But Saudi leaders remain constrained by domestic legitimacy, Islamic symbolism, and broader Arab political considerations. The Kingdom still seeks to preserve its position as the leader of the Muslim world. Openly embracing Israel at the Emirati pace would complicate that claim. The UAE does not appear equally constrained.
Abu Dhabi’s regional strategy increasingly prioritizes strategic flexibility over ideological consistency. It is building influence simultaneously through sovereign wealth, ports, military access agreements, logistics infrastructure, artificial intelligence partnerships, and normalization with Israel. In effect, the UAE is attempting to create geopolitical space outside the traditional Saudi-centered order. This explains why Abu Dhabi has become more willing to pressure states that remain closely tied to Riyadh. Its support for anti-Riyadh groups in Yemen and Sudan explains this policy. Adu Dhabi’s strangulation of Pakistan last month reflects this strategy much more clearly. Pakistan and the Emerging Gulf Divide For decades, Islamabad carefully balanced relations between Saudi Arabia and the UAE. Both Gulf states provided financial assistance, energy support, remittances, and diplomatic backing. But balancing becomes difficult when allies begin competing with one another. The UAE’s decision to demand repayment of more than US$3 billion from Pakistan, ending a long-standing rollover arrangement, was officially explained in financial terms. Yet the political timing was striking.
The move came amid rising regional tensions involving Iran and amid growing Emirati frustration with countries unwilling to adopt a more confrontational regional posture. Pakistan, despite its close ties with Saudi Arabia, has consistently attempted to avoid direct hostility toward Iran. Geography leaves Islamabad with little choice. Iran is a neighbor sharing a sensitive border with Pakistan’s already unstable Balochistan region. For Abu Dhabi, however, neutrality increasingly appears unacceptable.
The most revealing part of the episode was Saudi Arabia’s response. Riyadh quickly stepped in with fresh financial support and expanded economic assistance to Pakistan. This was not merely economic stabilization. It was geopolitical signaling. Saudi Arabia was effectively telling the UAE that Pakistan remained inside Riyadh’s strategic orbit. The broader implications are significant.
A loose counter-alignment is beginning to emerge across parts of the Muslim world. Saudi Arabia, Pakistan, Turkey, and Egypt do not form a formal bloc, nor do they agree on everything. Ankara and Cairo only recently repaired ties. Pakistan prefers strategic ambiguity. Saudi Arabia remains cautious about Turkish ambitions. Yet all four states share growing unease about the UAE’s increasingly disruptive regional activism and its rapidly expanding partnership with Israel. The End of Gulf Unity Western policymakers still talk about “the Gulf states” as though they form a coherent strategic bloc. That illusion is collapsing. The Gulf still exists as a geography. It no longer exists as a political unit. One of the unintended consequences of the US war on Iran is that it accelerated the fragmentation of the Gulf order itself. The divide is now unmistakable. Saudi Arabia wants a hierarchy with Riyadh at the center. The United Arab Emirates wants strategic autonomy and global influence. Saudi power rests on religion, size, and political centrality. Emirati power rests on money, ports, intelligence networks, technology, and transactional diplomacy. These are not merely different models of power. They are increasingly incompatible ones.
The old Gulf order was built on the assumption that monarchies with similar political systems ultimately shared the same geopolitical interests. They no longer do. Beneath the public language of partnership lies a fierce struggle over who will dominate the post-American Middle East. Iran may remain the Gulf’s main external threat. But the defining fracture of the next decade is likely to come from within the Gulf itself. This is the region’s new cold war. It will be fought not through ideology or revolutionary slogans, but through sovereign wealth funds, ports, trade routes, proxy wars, financial coercion, and normalization with Israel. Dr Salman Rafi Sheikh is an Assistant Professor of Politics at the Lahore University of Management Sciences (LUMS) in Pakistan. He is a long-time contributor on diplomatic affairs to Asia Sentinel. ---
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