U.S. President Donald Trump announced on May 6, 2025, that he will make a significant announcement ahead of his trip to the Middle East next week. Speaking from the Oval Office, Trump stated, "We will have a very, very big announcement to make. It's going to be very positive, and I won't tell you what it's about. It will be one of the most important announcements made in years on a specific topic." This announcement comes as Trump prepares for his first foreign trip since being re-elected in January, which will include stops in Saudi Arabia, Qatar, and the United Arab Emirates from May 13 to May 15.
During this trip, the U.S. is reportedly hoping to make progress regarding Gaza, where Israel has halted food and supply shipments for two months due to ongoing military actions. Both Trump and his predecessor, Joe Biden, have sought to secure Saudi Arabia's recognition of Israel, a significant milestone given that the kingdom is the custodian of Islam's two holiest sites. However, Saudi officials have indicated that they require visible progress towards a Palestinian state before moving forward.
Furthermore, the Israeli government has indicated plans to displace much of Gaza's population, with Finance Minister Bezalel Smotrich stating on Tuesday that the region "will be completely destroyed" following an unprecedented attack by Hamas on Israel a year and a half ago. While the U.S. has maintained its support for Israel, it has also expressed hopes for a new agreement that would include the return of hostages from Gaza. Qatar, acting as a key mediator, has stated that it continues its efforts in this regard.
In addition to diplomatic discussions, Trump's visit is expected to yield significant business agreements, particularly in the aerospace and defense sectors. According to Bloomberg News, Qatar Airways is close to finalizing a deal to purchase approximately 100 wide-body aircraft from Boeing, with the announcement anticipated during Trump's Middle East tour. This deal is part of a broader push for substantial investments in the region, which could approach $3 trillion, including arms deals and corporate agreements covering defense, aerospace, infrastructure, and technology.
Executives from leading American companies will accompany Trump to Saudi Arabia, where the U.S. is pressing for increased Gulf investments. Notable business leaders expected to attend include Larry Fink, CEO of BlackRock; Jane Fraser, CEO of Citigroup; Ruth Porat, CFO of Alphabet Inc. (Google); Stephen Schwarzman, CEO of Blackstone; and Jenny Johnson, CEO of Franklin Templeton Investments.
On May 13, the day of Trump's arrival, a Saudi Arabia-U.S. business forum will be held, focusing on key sectors such as artificial intelligence, advanced manufacturing, energy, and financial services. Crown Prince Mohammed bin Salman will host the forum, which aims to strengthen ties between the two nations and promote economic collaboration.
Trump's visit comes at a time when oil prices have fallen by more than $15 per barrel since he took office on January 20. The drop in oil prices followed Trump's announcement of tariffs on over 180 countries, escalating the ongoing trade war with China. This decline has prompted Gulf nations, heavily reliant on hydrocarbon exports for revenue, to reevaluate their economic forecasts.
For instance, Saudi Arabia, which was the fastest-growing economy in the G20 group in 2022 when oil prices averaged around $100 per barrel, has seen its economic outlook downgraded by the International Monetary Fund (IMF) as of April 23. The kingdom's gross domestic product (GDP) is now expected to grow by 3% in 2025, down from a previous estimate of 3.3%. Projections for 2026 have also been reduced by 0.4 percentage points to 3.7%, reflecting the impact of low energy prices.
The fiscal deficit in Saudi Arabia increased significantly to $15.65 billion in the first quarter of 2025, up from $3.3 billion in the same period last year, as oil revenues decreased by 18% year-on-year, according to the Ministry of Finance. Oil revenues for the quarter amounted to $39.95 billion.
As Trump prepares for this pivotal trip, the stakes are high for both diplomatic and economic outcomes. His administration aims to solidify its position as a key player in the Middle East while addressing pressing humanitarian issues in Gaza. With significant business deals on the table and the potential for historical diplomatic breakthroughs, the world will be watching closely to see what unfolds during this crucial visit.
