The 12-Day War between Iran and Israel exposed deep vulnerabilities in Gulf security, economic stability, and geopolitical balance. In light of growing escalation, all Gulf states pushed for de-escalation to preserve their strategic neutrality and business models. Europe, weakened by internal divisions and waning credibility, shares similar concerns yet lacks leverage. Despite diverging views on Israel, both the Gulf states and Europe face similar challenges from regional instability and energy insecurity to migration and economic disruptions. This shared vulnerability offers an opportunity for coordinated Gulf-European action. By aligning pragmatic diplomacy, security cooperation, and economic resilience, both actors can step out of bystanding roles and jointly promote a more stable and multipolar Middle East order.

Implications on the Gulf: Risking the Gulf model

The so-called ’12-Day War’ between the United States, Israel and Iran put the Gulf region region on the verge of full-fledged escalation and constituted a moment of profound crisis. Despite the cease fire which was declared on June 24 by US President Donald Trump, the region remains volatile, and the looming peril of further conflict and destabilization remains a top priority for regional players.

In this regard, the Gulf states find themselves in the eye of the storm and considered the war as a nightmare scenario. After the Israeli attacks on Iran started on June 13, 2025, all Gulf governments expressed their deep concern and denounced the military action of Israel calling for de-escalation and dialogue. The decision by the United States to enter the war by launching missile attacks on the Iranian nuclear facilities Natanz, Isfahan, and Fordow was considered as a further step towards regional escalation.

As their geoeconomic blueprint for regional and national stability is based on business development, regional economic integration, stable global energy markets, and an attractive investment environment, all Gulf states have been calling for regional de-escalation and a pathway for dialogue. In the mid- to long-run, the escalation of tensions would undermine such existential interests. As Gulf states want to stay out of the conflict as much as they can, the US airstrikes were not authorized to be launched from its military bases located in the Gulf states.

Since the onset of the Gaza war, the Gulf states have viewed Israel’s growing military assertiveness with increasing frustration and rejection. While they may welcome a weakened Iran, they are unwilling to accept Israel as the region’s dominant military hegemon supported by an unpredictable Trump administration. Instead, the Gulf states are pursuing a regional order based on strategic balance, geoeconomic cooperation, and favorable conditions for investment and trade. However, in recent years, Israel’s actions have increasingly undermined these objectives, challenging efforts to foster a stable and multipolar regional framework.

As a consequence, the Gulf states want neither Iran nor Israel to become too dominant in the region and thus promote a regional equilibrium in which they can serve as brokers, hubs for technological excellence, and smart interconnectivity, bridge-builders, and strategic communicators. In doing so, they could consolidate their reputation as beautiful, brilliant, and benign emerging middle soft powers in a multipolar global order.

Europe as a bystander: a lack of unity, a lack of credibility, a lack of leverage

Amid this fragile situation, Europe is not playing a significant role and is not considered as a reliable partner for peace and security from the Gulf states’ point of view. In the Gulf region and the broader Arab world, Europe’s credibility has significantly suffered in times of the Gaza war. Accusations of European hypocrisy after October 7, 2023, and in particular in light of statements by European leaders announcing their full support for Israel’s strikes against Iran feature prominently in the Gulf states. For instance, Germany’s Chancellor Friedrich Merz expressed his support for Israel’s right to defend itself, stating that Israel was “doing the dirty work for all of us” – a remark that was met with outright rejection in the Gulf states and followed by further criticism of GCC Assistant Secretary-General for Political Affairs and Negotiation Abdel Aziz Abu Hamad Aluwaisheg on Merz’s position on Israel. From the Gulf perspective, European diplomacy lacks leverage, coherence, and consistency to play a powerful role in the ongoing conflict as Europe is deeply divided on its position on Israel and Palestine. Such fractions have seriously damaged the reliability of Europe among regional players which consider Europe as a ‘toothless tiger’ with a lack of self-reliance and commitment.

Europe and Gulf: Joining forces to step out of the shadow

Despite such challenges, fault lines and the high level of polarization and alienation between Europe and the Gulf states, both sides need to consider the current crisis as an opportunity for enhanced collaboration. Neither Europe nor the Gulf states have played an active role in addressing the current escalation as they lack political agency and strategic leverage to influence the warring parties toward de-escalation.

As a result, both remain on the sidelines of the conflict but are increasingly exposed to shared vulnerabilities, including economic instability, energy insecurity, and heightened regional volatility. Their inaction underscores the urgent need for a more coordinated and proactive diplomatic strategy to mitigate the broader implications of the crisis.

Therefore, they should join forces in a more aligned and strategic way to step out of the shadow as bystanders as they are following similar interests:

• Mutual security interests: As the current vacuum of credible mediators and facilitators provides potential risks for ongoing crises, both the European Union (EU) and the Gulf states could take ownership by promoting diplomatic initiatives. Europe and the Gulf states share a number of strategic and security interests which are seriously damaged by ongoing crises in the Middle East. Key priorities of both European and Gulf foreign and security policy include combating irregular migration and refugee flows, drug trafficking, and Islamist terrorism; stabilizing regional crisis zones such as Syria, Lebanon, Yemen, Iraq, and Sudan; achieving a long-term resolution to the Israeli-Palestinian conflict; promoting economic progress; and safeguarding social resilience. Further escalation of crises could result in more illegal migration from the Middle East which will also impact Europe’s social resilience and stability. These overlapping strategic interests underscore the need for closer cooperation in the field of security policy.
• Mutual economic interests: The Gulf states are undergoing an equally ambitious process of economic diversification and modernization and are thus presenting high potential for deeper economic cooperation. Similar to the Gulf states, also the EU finds itself in a delicate situation: Its “business first” model is at stake and threatened by the Russian war of aggression against Ukraine. Thus, neither side is interested in a further escalation of tensions between Iran and Israel for security, economic, and political reasons.

Breaking the ongoing cycle of tit-for-tat violence

As a consequence, both Europe and the Gulf states are considering the ongoing cycle of tit-for-tat violence in the region as counter-productive for strategic and business interests.

Focusing on realism, mutual respect, and long-term strategic thinking rather than fragmentation, demonization, and polarization could thus provide a substantial opportunity for Gulf states and Europe to gain more leverage, overcome mutual mistrust and provide an alternatives for disruption and destabilization.

Certainly, ties between Europe and the Gulf states have intensified but still they are acting in silos. Furthermore, rather than expecting from the US to do the job, both the Gulf states and Europe should identify more platforms for strategic autonomy, interdependency and interconnectedness. Forums such as regular EU-GCC meetings, the Saudi-French Global Alliance for the Two-State Solution, and bilateral delegations are helpful but lack a comprehensive realistic vision for the region. Here, concrete activities are needed to go beyond lip service and prevent further escalation.

To be clear: The creation of a comprehensive and inclusive regional security infrastructure seems to be over-ambitious and thus unrealistic as diverging interests and opposing perspectives will undermine such ‘grand masterplan’. Alternatively, concrete fields of action need to be defined as well as different channels of communication used:

Managing diverging expectations and perspectives: In the context of the Gaza war, Europe’s reputation in the Gulf monarchies has further deteriorated. While the Gulf states continue to regard Europe as a relevant partner in economic cooperation, they no longer see it as a politically influential actor in the region. To counter this perception, credible expectation management is essential. Europe’s military and security capabilities are often overestimated in the Gulf, as they are viewed in proportion to its economic strength and its military support for Ukraine. It is therefore necessary to communicate openly and self-reflectively about Europe’s strategic strengths and limitations.

Highlighting the complex transformation of its economy, the ongoing modernization of its armed forces, and administrative reforms can help foster a more realistic and nuanced understanding of Europe’s current position. The ongoing war in Gaza and the pro-Israeli position of some European states remain particularly sensitive and contentious topics. Here too, mutual understanding should be the guiding principle. The Gulf states increasingly view Israel as a source of regional destabilization that threatens their own interests and objectives. The Netanyahu government is perceived as unpredictable and therefore not a reliable negotiating partner.

In turn, many European governments continue to express solidarity with Israel despite growing criticism of Netanyahu within Europe. This divergence in perception has led to a loss of trust between the Gulf states and Europe which hinders closer coordination. It is therefore essential to avoid getting caught in blame games or whataboutism and instead acknowledge differing perspectives while actively seeking new paths to de-escalation. This requires honesty and deeper engagement not only at the governmental level but also across societal, academic, media, and cultural platforms.

Enhancing coordinated communication with all conflict parties: Coordinated communication efforts by Europe and the Gulf states with all conflict parties could help to deescalate the situation.

With its all-in military action driven by a ‘might is right’ approach, Israel finds itself in a situation of regional isolation. From a security and economic perspective, chances for further normalization with Arab states such as Saudi Arabia remain grim which further undermines opportunities for enhanced business relations and regional prosperity for both Israel and the Arab neighborhood. Therefore, European actors should use their long-standing relationship with Israel to push for de-escalation and warn for further conflict escalation fueled through Israel’s military engagement such as in Syria.

Additionally, Israel’s actions in Gaza and the Westbank are considered critically by a number of EU member states: The UN is stating that Palestinians in the West Bank, including East Jerusalem, are increasingly being subjected to forced displacement and land seizures. In total, more than 46,400 Palestinians have been forcibly displaced between October 2023 and May 2025 from the West Bank including three refugee camps in Jenin and Tulkarem. In June 2025, Spain, Ireland and Slovenia called for the suspension of the EU-Israel Association Agreement. Sweden has also asked the European Council to adopt sanctions “against Israeli ministers who promote illegal settlement activities and actively work against a negotiated two-state solution”. Accordingly, the EU High Representative for Foreign Affairs and Security Policy, Kaja Kallas, has put forward ten potential sanction measures against Israel, which have been discussed at the Council of the EU meeting in July. Such potential sanctions include the suspension of the  EU-Israel Association Agreement which was introduced in 2000, the suspension of visa free travel and the ban of imports from the Jewish settlements.

Furthermore, new sanctions against individuals that are responsible for, involved in or associated with genocide, crimes against humanity, or any other serious, widespread and systematic human rights violations seem to be possible in the framework of the EU Global Human Rights Sanctions Regime (GHRSR). Already in 2024, five Israeli settlers and three entities in the West Bank and East Jerusalem were sanctioned followed by a number of sanctions of countries such as the UK or Norway against Israeli organizations and individuals such as ministers.

In light of the opposition of a number of EU member states such as Germany, the Czech Republic and Hungary, though, the introduction of such sanctions remains highly unlikely but sends a message to the Netanyahu government that support is declining inside Europe.

Additionally, the Gulf states see themselves as beneficiaries and strategic winners of an emerging multipolar world order. Their approach of building pragmatic and flexible networks with Iran also offers opportunities for Europe to engage in joint efforts to promote security and prosperity. To seize these opportunities, a closer and more respectful exchange is required which leverages diverse communication channels efficiently to enhance coordination. Such an approach holds particular potential for addressing regional crises, including those in Gaza, Syria, Yemen, and Sudan.

As Trump’s position on the conflict is rather ambiguous, the Gulf states and Europe could further aim to promote de-escalation by engaging through their individual communication channels with the US administration. Since Trump is primarily interested in deals and transactional economic agreements, the Gulf states and Europe could adopt a geoeconomic approach to persuade him pursuing a policy of deescalation. After all, a stable region offers better business opportunities for the United States as well – especially with the Gulf states. His previous visit to the Gulf demonstrated how closely both sides wish to cooperate economically.

However, Trump’s support for Israel against Iran has also made it clear to the Gulf states that their agreements with the US could be jeopardized by his transactional military backing of Israel. In the long term, this would not only harm the Gulf states but also undermine Trump’s own business interests and could push for closer Europe-Gulf cooperation in light of Trumps’s unpredictability.

Preserving national security: Faced with a complex and precarious security environment, the Gulf states have become increasingly aware of their strategic vulnerabilities. Despite long-standing security and defense partnerships with the United States, the recent escalation between Iran and Israel has exposed the Gulf countries to heightened risks of Iranian retaliation. Initially, Gulf leaders preferred a policy of US restraint as they fear that deeper US involvement in the conflict could inadvertently draw their own territories into a confrontation they neither provoked nor sought.

In fact, they had actively sought to prevent it by encouraging both Washington and Tehran to reach a workable new nuclear agreement. However, this calculation failed when Trump ordered to strike Iranian nuclear facilities and stopped all negotiations with Iran about the nuclear program. As a consequence, Iran attacked the US military base Al Udeid located in Qatar. Certainly, no human casualties occurred as the Qatari leadership was warned by Iranian military about the upcoming attack. The attack thus showed similarities to Iran’s strikes on US military facilities located in Iraq in January 2020 after US troops had killed Iran’s Quds Force commander Qassem Soleimani. Therefore, it was called a ‘symbolic’ rather than a serious attack of Qatari national integrity and security.

However, the claim that it was not an attack on Qatari territory but solely a strike against the United States was vehemently rejected by Qatari interlocutors. Instead, it was a calculated message to the US and its Gulf allies that Iran is still capable and willing to strike strategic targets in its direct neighborhood.

Thus, the attack represents a watershed moment in Gulf security dynamics as it was the first direct strike by a state on a Gulf state since Iraq’s 1990 invasion of Kuwait. Hence, in Qatar and other Gulf states, the attack was perceived as a next level of regional escalation and was harshly condemned. Qatar and Iran are enjoying pragmatic political and close economic ties as they are sharing the largest gas field in the world. As a consequence, the attack constituted a shock for Qatar as well as for other Gulf states as they have faced similar scenarios in recent years. For instance, Iranian strikes hit Saudi Arabia’s oil facilities Abqaiq and Khurais in 2019, and the Yemeni Houthis attacked the Abu Dhabi in the United Arab Emirates (UAE) in 2022.

Despite the fact that the current rapprochement between Iran and the Gulf states is minimizing such risk, it does not seem totally impossible if new attacks on Iran would happen. The more the Iranian regime could come under pressure and find itself in survival mode, the more it could act in a non-logical and assertive way by attacking the energy infrastructure of its Gulf neighbors.

Such a worst-case scenario should be prevented at all cost, and thus needs closer Europe-Gulf coordination. The potential risk of future retaliation strikes poses a mutual security concern for Europe as the Gulf states are considered as reliable and relevant security and business partners. If energy production would be affected by attacks on oil and gas refineries combined with strikes on military bases by Iran, Europe’s energy supply would be damaged.

Both Europe and the Gulf states share a commitment to upholding the international order and express concern over violent conflicts that could shift borders and spheres of influence. In contrast to the unpredictable policies of the United States under Trump, the interventionist proxy-driven destabilization efforts of Iran or the hyper-securitization of Israel, the Gulf states are standing for economic and social regional development, pragmatic stability and geoeconomic statecraft which is also in the interest of Europe.

Disrupting maritime security and trade routes: While the recent Israel-Iran confrontation did not cause major physical disruptions to oil supply, market reactions reflected deeper structural vulnerabilities. These include heightened geopolitical risk perception, the fragility of maritime chokepoints such as the Strait of Hormuz, and limited alternative export routes. The crisis thus revealed the growing influence of threat expectations on energy markets, even in the absence of actual damage.

Here, the 12-Days War has exposed the extent to which perception, not just physical disruption, drives instability in global energy markets. Ensuring the security of vital maritime routes and reducing overreliance on the Strait of Hormuz must become a strategic priority for both regional and international stakeholders and thus presents another relevant entry point for closer European-Gulf relations.

Joint efforts to strengthening diplomatic backchannels among Gulf states, Europe, and Iran to prevent escalation and miscalculation around critical chokepoints, encouraging investment in alternative export routes and logistics infrastructure to improve resilience and bypass the Strait of Hormuz, improving oversight and maritime security cooperation to manage risks posed by poorly regulated vessels in congested waterways such as the Strait of Hormuz, the Red Sea, and the Bab al-Mandab Strait and facilitating energy security dialogues that include Israel, Iran, Gulf states, and key consumers like the EU to align expectations and reduce brinkmanship could lead to more maritime security.

Engaging diplomatic efforts to resuming nuclear talks: After the attacks on the nuclear facilities, Trump and Israel claimed that Iran’s nuclear program had been destroyed. However, significant doubts have been raised about this assertion. Instead, the Gulf states fear that Iran may now feel more encouraged than ever to pursue a nuclear weapon which could potentially trigger a nuclear arms race or a nuclear domino effect.

The Gulf states, particularly Kuwait, Qatar, and Bahrain, are also deeply concerned about the potential release of nuclear radiation in the event of future attacks on Iran’s nuclear facilities such as Busher. While, according to official reports, no elevated radiation levels have been detected so far, the geographical proximity of these states to Iranian nuclear sites places them in a vulnerable position which that can only be stabilized through a long-term resolution of the conflict. A nuclear contamination of the region would not only have catastrophic consequences for local populations and ecosystems but would also severely impact global trade and Europe’s economic interests.

In this context, all Gulf states have shown interest in resuming negotiations over Iran’s nuclear program, even though the current situation has made rapprochement between the conflicting parties Iran and the US nearly impossible. This makes it all the more important for the Gulf states and Europe to pool their efforts and diplomatic channels to rebuild lost trust. Oman previously mediated and hosted US-Iranian talks ahead of the 12-Day War and could once again play a role as mediator in a new phase. Saudi Arabia also maintains strategic communication channels with both Tehran and Trump. Particularly the E3 (France, Germany, and the United Kingdom) could likewise play a constructive role.

In this context, the idea of a nuclear consortium could once again become a more prominent subject of discussion, under which a civilian nuclear program and uranium enrichment would emerge as a joint effort between Iran and neighboring states such as Qatar, Saudi Arabia and the UAE by establishing a joint enrichment facility on an island in the Gulf.

Furthermore, Europe and the Gulf states could enter discussions about a regional nuclear verification system similar to the Brazilian-Argentine Agency for Accounting and Control of Nuclear Materials (ABACC) to build confidence. In this regard, the BRICS+ format could facilitate enhanced discussions between Iran and the UAE that are new members of the bloc and Brazil supported by Europe. Such efforts could enhance regional nuclear integration, transparency, and control mechanisms. However, potential for such form of collaboration remains highly unlikely at the current stage as Iran has halted its cooperation with the IAEA.

Preserving regional economic development: In economic terms, the conflict did not directly hamper the ambitious business models of the Gulf states. In contrast, the immediate rise in oil prices in light of the crisis presented an opportunity for oil-producing Gulf states to generate more revenues.

However, such effects only serve short-term interests. In the long run, the conflict undermines the Gulf states’ efforts to position themselves as stable and neutral hubs for global capital, investment, tourism, and financing. Cities like Dubai, Abu Dhabi, and Riyadh have actively pursued roles as regional business hubs, aiming to attract multinationals, tech companies, and investors by offering geopolitical stability, regulatory clarity, and a predictable business environment. Attacks on high-value civilian infrastructure (e.g., airports, ports, desalination plants) could significantly impact key economic sectors. While such attacks remain hypothetical, their potential must be factored into regional risk planning.

The current volatility, thus, challenges the Gulf business model and may affect investor confidence. Therefore, Gulf governments will continue to emphasize geoeconomic diplomacy, strong defense capabilities, and internal security to reassure investors and residents.

While Europe has traditionally been one of the Gulf states’ key trading partners, a closer alignment between foreign and economic policy could further strengthen these ties. There is no question that Europe’s economic relevance has diminished in recent years, as Gulf actors increasingly turn to alternative partners from the United States, China, and India to East Asia.

Nonetheless, European partners continue to enjoy a strong reputation across the Gulf. What is expected, however, is a clear and strategic approach, competitive offers, and greater flexibility in implementation. Bureaucratic obstacles, a lack of political support, and public criticism are frequently cited as barriers to expanding economic cooperation. Addressing these concerns will be essential for Europe to remain a relevant and trusted partner in the Gulf’s evolving economic landscape.

Joint business partnerships such as the EU-UAE free trade agreement as well as the authorization by the EU Council for the EU Commission and the High Representative to enter into bilateral negotiations with the Gulf states to concluding bilateral Strategic Partnership Agreements (SPAs) show the growing intention for enhanced partnership. Such models also serve as an alternative for the EU-GCC Free Trade Agreement which has not been materialized yet. In light of the reduction of US aid, improved coordination between Gulf and European humanitarian efforts and development cooperation could lead to more efficient reconstruction efforts and resource allocation in crisis-affected countries such as Syria, Yemen, and Sudan.

As Europe and the Gulf states are similarly impacted by the fall-out of regional escalation in security, business, and political ways, they should both aim to consider the current fragmentation of regional order as a window of opportunity to provide an alternative for dialogue.

Pooling human, financial, and soft power resources and acting together is thus the most efficient way to create synergy effects in economic diplomacy, dialogue facilitation, reconstruction, and conflict mediation. Otherwise, the descent into regional chaos will destabilize Europe and the Gulf states – a catastrophic scenario for them and a win for disrupting powers.