There’s a version of this week that looked very different. U.S. warplanes were reportedly within striking distance of Iranian targets. Oil markets were bracing. Gulf equity investors were quietly panicking. Then, on August 2, 2026, Donald Trump posted on Truth Social that he was calling it off.
The announcement that the U.S. had canceled planned military strikes against Iran landed like a pressure valve releasing. Gulf stock markets, including Saudi Arabia’s Tadawul, reversed negative trends that had built through July and climbed in early trading on August 3.
What actually happened
The cancellation didn’t come out of nowhere. Saudi Arabia, Qatar, and the UAE had been actively lobbying Washington for a diplomatic off-ramp, and they apparently got one.
The Gulf states reportedly proposed a framework centered on reopening the Strait of Hormuz, the narrow waterway through which a significant portion of the world’s seaborne oil passes. That offer gave the Trump administration something it could present as a win without pulling a trigger.
