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The sector also faced broader macro headwinds, including a more cautious policy backdrop in China and global risk-off belief driven by geopolitical stress and higher energy prices. Thematic ETFs likewise had a hard time for the most part, especially those connected to carbon and high-growth innovation, as assessment pressures and worldwide rate dynamics weighed on performance.
The petrochemical ETF substantially outshined. Flows in Q1 2026 were modest and highly focused, reflecting selective allowance rather than broad market involvement. Despite weak efficiency, ETFs taped $27.1 million in net inflows, with only a small number of products attracting brand-new capital. This suggests that investors were targeting specific direct exposures, while minimizing or rotating out of others.
Trading activity remained stable, with typical 30-day volumes around 33,000 shares, concentrated in a handful of bigger and more liquid ETFs. The majority of activity appears to have occurred in the secondary market, making it possible for financiers to change positions without significant primary creations or redemptions. While current geopolitical events have resulted in more financial pressure on GCC nations, the region remains resistant and well capitalized to deal with the circumstance.
In January, Boreas released its S&P Global Luxury UCITS ETF, including a specific niche thematic exposure concentrated on worldwide high-end and consumer brands. Momentum continued into April with the approval of KraneShares AGIX and KWIN ETFs by the CMA for cross-listing on ADX. These funds are expected to release in April pending a last approval from ADX.
Q1 2026 revealed some development connecting to ETFs in the GCC. We anticipate more global and thematic ETFs to list in the GCC throughout 2026. While the dispute has impacted belief and costs during the quarter, it has driven more volume and interest in regional properties.
Despite continuous geopolitical tensions and security threats throughout the Middle East, the economies of the Gulf Cooperation Council (GCC) have continued to demonstrate strength, maintaining favorable development momentum recently. While disputes in the broader area and global financial unpredictability stay a structural restraint, GCC countries have actually up until now restricted their influence on domestic financial performance through strong fiscal positions, policy connection, and sustained investment.
3.2 percent development in 2025, speeding up to 4.5 percent in 2026. Sees momentum improving, with GCC output development projected to increase from 1.7 percent in 2024 to 3.3 percent on average in 2025, showing a shift toward more favorable overall conditions.
Key Advantages of Strategic Efficiency in 2026The IMF's World Economic Outlook (October 2025) jobs international development easing to 3.1 percent in 2026, with advanced economies around 1.5 percent and emerging market and developing economies just above 4 percent. On that comparison, a 4.44.5 percent GCC growth would place the region materially ahead of the world average and slightly above (or broadly in line with) the emerging-market aggregate, reinforcing the GCC's status as a reasonably high-growth pocketprovided that regional threat conditions remain contained and reform momentum holds.
Information from the GCC Statistical Center show that non-oil sectors already account for more than 73 percent of total GDP, a share that has continued to rise as governments expand investment in services, infrastructure, and technology. According to Oxford Economics, non-energy activity across the GCC is predicted to grow by around 4.1 percent in 2026, supported by strong labor markets, improving credit conditions, and increasing investment in innovation and AI-related infrastructure.
Public-sector financial investment and reform stay central to sustaining this trend. Policy steps targeted at bring in foreign direct financial investment, easing foreign ownership guidelines, broadening capital markets, and supporting private-sector participation continue to underpin non-oil expansion and lower the region's direct exposure to oil cost volatility. While hydrocarbons no longer control the development outlook, oil earnings are anticipated to play an encouraging function in 2026.
3.2 percent development in 2025, accelerating to 4.5 percent in 2026. Sees momentum improving, with GCC output growth predicted to increase from 1.7 percent in 2024 to 3.3 percent on average in 2025, reflecting a shift toward more favorable overall conditions.
The IMF's World Economic Outlook (October 2025) projects international development reducing to 3.1 percent in 2026, with sophisticated economies around 1.5 percent and emerging market and developing economies simply above 4 percent. On that comparison, a 4.44.5 percent GCC expansion would position the region materially ahead of the world average and slightly above (or broadly in line with) the emerging-market aggregate, enhancing the GCC's status as a reasonably high-growth pocketprovided that local risk conditions remain consisted of and reform momentum holds.

Information from the GCC Statistical Center show that non-oil sectors currently account for more than 73 percent of total GDP, a share that has continued to increase as federal governments expand financial investment in services, facilities, and innovation. According to Oxford Economics, non-energy activity throughout the GCC is predicted to grow by around 4.1 percent in 2026, supported by strong labor markets, improving credit conditions, and increasing financial investment in technology and AI-related facilities.
Key Advantages of Strategic Efficiency in 2026Public-sector financial investment and reform remain central to sustaining this pattern. Policy steps targeted at bring in foreign direct investment, easing foreign ownership guidelines, broadening capital markets, and supporting private-sector participation continue to underpin non-oil expansion and decrease the region's direct exposure to oil cost volatility. While hydrocarbons no longer control the growth outlook, oil earnings are anticipated to play a supportive function in 2026.
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