Gulf Sovereign Wealth Funds Boost Dealmaking Amid Iran War: $26B Spent in Q1 2026

Gulf sovereign wealth funds have defied expectations by accelerating their global investment spree despite the ongoing Iran conflict, injecting nearly $26 billion into markets over the past three months. The five largest funds—Saudi Arabia’s Public Investment Fund (PIF), the UAE’s Mubadala, Abu Dhabi Investment Authority (ADIA), L’imad and Qatar Investment Authority (QIA)—have maintained or even increased their dealmaking pace, bucking predictions that geopolitical tensions would dampen their appetite for capital deployment.

The data, compiled by industry specialist Global SWF in its latest report published on June 1, reveals that the funds collectively spent $25.9 billion between March and May, with the majority directed toward developed market assets. While the QIA slightly reduced its quarterly investment pace to around $2 billion, the other four funds either maintained or accelerated their spending, with PIF and ADIA shifting a significant portion of their capital toward emerging markets—particularly China—since the start of the Iran war.

PIF’s Shift Toward Emerging Markets and Domestic Focus

Since the conflict escalated, PIF has invested $6.1 billion in emerging markets, more than double the $2.43 billion it has allocated to developed markets. ADIA, meanwhile, has directed $3.32 billion into emerging economies compared to $1.58 billion in developed markets. However, PIF is now pivoting toward its domestic economy, with approximately 80% of its $1 trillion portfolio now focused internally.

In mid-April, PIF unveiled a five-year strategy centered on six key sectors: tourism and entertainment, urban development, advanced manufacturing, industrials and logistics, clean energy and renewables infrastructure, and Neom, the $500 billion smart city project in Saudi Arabia’s Tabuk province. The fund’s domestic emphasis reflects a broader regional trend of sovereign wealth funds prioritizing national economic diversification while still maintaining a global footprint.

UAE’s Sovereign Investment Powerhouse Expands Ambitions

In January, Abu Dhabi’s government consolidated its strategic assets by merging the Abu Dhabi Development Holding Group (ADQ) with L’imad, creating a $300 billion sovereign investment powerhouse. L’imad’s mandate spans infrastructure, property, financial services, technology, and smart cities, with a dual focus on managing domestic “national champions” such as Abu Dhabi Ports and Etihad Rail, and participating in high-profile international deals.

In May, L’imad announced a $30 billion venture targeting energy, transportation, and logistics across the Middle East and Central Asia, partnering with BlackRock’s Global Infrastructure Partners and Singapore’s Temasek Holdings. The fund is also poised to commit roughly $24 billion in equity to Paramount Skydance’s $110 billion takeover of Warner Bros. Discovery, a deal expected to close between July and September pending regulatory approval.

A Resilient Investment Machine

The collective resilience of Gulf sovereign wealth funds—managing a combined $5.7 trillion in assets—stands in stark contrast to the volatility triggered by the Iran conflict. While U.S. And European markets initially feared a pullback, the funds have not only sustained but accelerated their investments, diversifying their portfolios across geographies and sectors.

The data underscores a strategic calculus: despite geopolitical risks, Gulf funds view global opportunities as too significant to ignore. Their continued activity signals confidence in long-term returns, even as regional tensions persist. For now, the investment machine shows no signs of slowing.