JP Morgan Chase has raised and deployed more than $20 billion into the Gulf region since the beginning of the Iran war, according to Doug Petno, co-chief executive of commercial and investment banking operations.
Mr Petno told The National the bank has expanded its risk limits across the region, scaling capital deployment in response to both regional need and opportunity. He declined to specify how much the bank’s risk appetite has changed but said dedicated teams are mapping the Middle East to assess how best to meet massive capital expenditure requirements.
Infrastructure and AI lead postwar priorities
Commercial lenders are not the only ones seeking opportunity, Mr Petno noted. Private equity firms are also travelling to the region to fill capital gaps, with some infrastructure projects carrying time sensitivity.
“It could be our balance sheet, it could be the public market, it could be a private market, but the numbers are substantial, market by market,” he said.
True scale of postwar capex remains difficult to assess while conflict continues, Mr Petno acknowledged. “When it's over, I think the world will get a better sense for what it's going to cost to repair and what it's going to cost to diversify,” he said. “The one thing I think is certain, the number will be substantial – in the hundreds of billions of dollars.”
US and Israeli strikes on Iran, and Tehran’s subsequent attacks on Arab neighbours beginning on February 28, have severely disrupted business activity and threatened global economic growth. Iranian strikes on energy and civilian infrastructure in March and early April have left Gulf nations and Iraq needing both reconstruction financing and continued diversification support.
Mr Petno, who met sovereign and corporate clients in recent weeks, said conversations varied by country based on cash flow, economic impact, and pre-existing diversification levels.
Data centre resilience, oil and gas installations, product pipelines, logistics, and “where do we go from here” topped discussions. JP Morgan expects most capex will target these areas in postwar rebuilding.
Another major capital requirement will stem from the AI supercycle in the region, which Mr Petno said is “very well placed to participate in, given the natural advantages it has around energy and their energy cost curve.”
“In some markets, we had significant conversations related to our work on security and resiliency, and it ties to defence tech, it ties in with having supply chain resiliency,” he said. “Most countries have … [a] single point of failure that they were reminded of in this crisis, and now they are taking steps to remedy that. And for that, they're going to need capital, need access.”
