Who Really Seeks Control of the Red Sea Gateway?

The United States has repeatedly intervened in conflicts across the Middle East, often justifying its military presence as essential to regional stability and the protection of international trade. Yet an important question remains, do these interventions resolve security crises, or can they also create opportunities to expand American strategic influence? The confrontation involving Saudi Arabia, Yemen’s Houthis and the United States deserves scrutiny from this perspective.

The Houthis intensified attacks on shipping in the Red Sea after the Gaza war erupted in October 2023, declaring their campaign a means of pressuring Israel. Vessels linked to Israel became particular targets, although the attacks and their consequences extended beyond Israeli shipping. International trade was disrupted, seafarers were endangered and the security of the Bab el-Mandeb Strait became a global concern.

However, threatening shipping bound for Israel is not the same as deliberately targeting Saudi Arabia. Each reported attack must be examined on its own evidence, including the identity of the attacker, the intended target and the strategic purpose. Iranian support for the Houthis does not, by itself, establish Iranian direction of every operation.

Washington has presented its military campaign against the Houthis as a response to threats against navigation and regional security. But military intervention can produce consequences beyond its declared objectives. By expanding its operational presence, surveillance and influence over maritime security, the United States can strengthen its position around a gateway connecting the Red Sea with the Gulf of Aden and the wider Indian Ocean.

This raises a question that deserves serious investigation, could the escalation of hostilities be creating the strategic conditions for greater American influence over access to one of the world's most important shipping corridors?

The possibility should not be confused with proof that Washington engineered the confrontation or that a US proxy is responsible for attacks attributed to the Houthis. Such allegations require independently verifiable evidence. Nevertheless, the strategic consequences of military operations merit examination regardless of their stated intentions.

I prefer to frame the broader issue as “US-Controlled Entry and Exit” rather than simply a blockade. Control over a maritime gateway need not involve formally closing it. It can also emerge through military deployments, intelligence capabilities, security partnerships and the ability to influence the conditions under which commercial vessels pass.

The central issue, therefore, is not merely whether the Houthis threaten Saudi Arabia or whether American forces can suppress them. It is whether the resulting security arrangements protect freedom of navigation for all nations or gradually concentrate strategic leverage in the hands of an outside power.

The world must distinguish between securing an international waterway and acquiring the power to determine who can use it, on what terms and under whose protection. That distinction may ultimately prove more consequential than the military confrontation itself.

PSX benchmark index declines 0.6%WoW

Pakistan Stock Exchange (PSX) remained volatile during the week ended on October 09, 2026 amid continued attacks on key shipping routes. The benchmark Index declined by 1,066 points or 0.6%WoW to close at 167,089. Market activity also weakened, with average daily trading volume declining by 16.5%WoW to 541 million shares.

Meanwhile, Ukraine’s drone strikes on Russian refineries and concerns over US energy supplies amid Hurricane Isaias kept Brent oil prices above US$100/ bbl, despite improving traffic through the Strait of Hormuz and Trump’s claim that it would refrain from attacking Iran until the midterm elections scheduled for early November 2026.

The IMF reached a Staff-Level Agreement with Pakistan on the 4th review of EFF and 3rd review of RSF, acknowledging the Government’s policies in navigating the Middle East conflict.

Foreign exchange reserves held by State Bank of Pakistan (SBP) increased to US$21.5 billion as of October 02, 2026.

Pakistan raised PKR352 billion in the latest PIB auction, with yields rising across all tenors.

Banking sector deposits rose 14%YoY to PKR39.2 trillion at end August 2026.

Cement offtakes increased 6%YoY to 4.6 million tons in September 2026, reflecting improved local demand due to recovery in construction activity.

Cotton arrivals increased 5%YoY to 3.2 million bales during the same period.

Other major news flow during the week included: 1) Makkah defence alliance agrees to 'rapid force deployment' in Saudi Arabia, 2) GoP debt posts marginal decline to date, 3) GoP clears nine bidders for Gepco sale, 4) Bahrain working to 'speed up' approval of Pak-GCC free trade pact, and 5) Pakistan, Qatar agree to review LNG deal.

While the laggards were: Vanaspati & Allied Industries, Leasing companies, and Sugar, Textile spinning, Synthetic & Rayon, and Modarabas emerged top performers.

Major selling was recorded by Mutual Funds with US$17.6 million. On the contrary, net buyers were Individuals (US$11.4 million) and Companies (US$6.5 million).

Top performing scrips were: TGL, PSO, BML, AGP, and FCCL, while laggards included: SSOM, PGLC, CPHL, IMAGE, and PSX.

AKD Securities anticipates the market to improve on the back of strengthening economic indicators. Additionally, easing inflationary pressures would reduce probability of monetary tightening. Any positive development on Middle East conflict could moderate international oil prices and serve as a key trigger for market, paving the way for monetary easing.

The market continues to trade at attractive valuations. The top picks of the brokerage house include: OGDC, PPL, UBL, MEBL, HBL, FFC, ENGROH, PSO, LUCK, FCCL, INDU, ILP and SYS.

Over 80 US aircrafts destroyed or damaged

According to Saudi Gazette, the US military has had at least 81 aircraft destroyed or damaged during military operations against Iran. The figures comprise of operational incidents recorded since February 28, 2026 across Pentagon records, US Central Command (CENTCOM) statements, military inspector general findings, and press accounts.

The number includes both airplanes and helicopters as well as drones, with the MQ-9 Reaper drone – used for intelligence, surveillance and reconnaissance, close air support and combat search and rescue – accounting for more than half of the losses.

Also on the list are some of the Pentagon’s most-prized assets, including an F-35A fighter jet and an E-3 Sentry, the four-engine jet with a large radar dome atop the fuselage used for target tracking and airspace management.

The total cost of the aircraft lost is between US$1.9 billion and US$3.3 billion, depending on the Defense Department’s plans for replacements, the report said, citing figures from the Congressional Budget Office.

The total cost of the war is much higher – at least US$45 billion. That figure doesn’t include damage to infrastructure at US bases in the region, including those where some of the aircraft losses happened.

Some of the aircraft included in the count may have been returned to service, including eight F-15 Strike Eagle fighter jets that sustained light damage in an Iranian strike on Muwaffaq Salti Air Base, Jordan, in September.

The report is based on numbers contained in statements from the Defense Department; its inspector general; US Central Command, which has been conducting the operations against Iran; and news reports reviewed by the CRS.

The report poses several questions for congressional consideration, including whether lawmakers are getting enough information from the Pentagon on the losses to determine effects and remedies.

Defense Department reporting on Iran war losses has, to date, been vague. Even the Pentagon inspector general’s report on the losses, released in September and covering action from February 28 to June 30, cites previous CRS reports for some of its aircraft loss numbers.

Other issues Congress needs to think about are whether to provide funding for repairs or replacements; whether there is enough industrial capacity to satisfy those requirements; and the effects on US military sales to foreign partners.

It also raises questions about how the Iran war has affected US posture outside the Middle East.

“Congress may assess whether losses in certain high-demand platforms that are aging and limited in number, such as the E-3 Sentry, create capability gaps or increase risk in other theaters,” the report says.

Analysts have said actions in the Middle East, including the Iran war and earlier confrontations with the Houthi rebels in Yemen, an Iranian proxy group, have taken an especially heavy toll on the MQ-9 drones, which Air Force Chief of Staff Gen. Kenneth Wilsbach told Congress earlier this year was the military’s “most valuable player” in the war with Iran.

Forty-five have been lost in the Middle East this year, “an alarming rate,” according to a September report from the Atlantic Council.

The Air Force has lost about 35% of its MQ-9s since 2004, it says.

 

Has the World Forgotten the Gazans?

October 7 has become a date the world remembers for different reasons. Three years ago, Hamas and other Palestinian armed groups attacked Israel, killing more than 1,200 people and taking 251 hostages. The attack was horrific, and nothing can justify the deliberate killing or abduction of civilians. But October 7 also marked the beginning of a catastrophe whose human consequences in Gaza continue to unfold.

Nearly three years of Israeli bombardment and ground operations have killed more than 74,000 Gazans, according to figures reported by Gaza authorities. Much of Gaza has been reduced to rubble. Hundreds of thousands of homes have been destroyed or damaged, hospitals and schools have been devastated, and essential water, sanitation and electricity infrastructure has been severely compromised.

Yet statistics cannot capture what life means for a population that has lost homes, livelihoods, schools, hospitals and basic services. Gazans have been displaced repeatedly and continue to live in extremely difficult conditions. Even after a ceasefire agreement, violence and humanitarian challenges persist.

Then came another geopolitical shock. Since February 28, 2026, the US-Israel war with Iran has consumed international attention. Gaza, already pushed to the margins, has slipped even further down the world's agenda. This raises an uncomfortable question: Has the world become accustomed to Gazans' suffering?

The most disturbing possibility is that Gaza's destruction will eventually be viewed not as a humanitarian catastrophe requiring justice, but as a redevelopment opportunity requiring investment. With billions of dollars needed for reconstruction, the temptation to see Gaza primarily through the lens of real estate, tourism and strategic interests could become enormous.

History may therefore record these three years in one devastating sentence: The world watched Gaza being destroyed, then waited for the rubble to clear so that the real-estate bonanza could begin.

But Gaza is not an empty piece of land awaiting developers. It is home to Gazans who have survived war, displacement and unimaginable loss. Reconstruction must restore not merely buildings, but dignity, ownership, livelihoods and the right of Gazans to determine their own future.

The world still has a choice: remember Gaza as a human tragedy—or allow the suffering of Gazans to become someone else's opportunity.

Brewing Turmoil in India

The brewing turmoil should be treated as a warning—not dismissed as merely another season of protests.

India's impressive economic numbers increasingly appear to be masking a more uncomfortable reality. Beneath the narrative of rapid growth and rising global influence, public frustration is building over unemployment, stagnant real wages, inflation, women's safety and growing doubts about the integrity of democratic institutions.

The latest wave of protests reflects this widening disconnect between India's economic performance on paper and the everyday experiences of many citizens, particularly the young. Although, India remains one of the world's fastest-growing major economies, employment opportunities and real wage growth have not kept pace with expectations. Rising consumer prices have further eroded purchasing power, encouraging an increasing number of young Indians to seek opportunities abroad, including in the European Union.

Monetary policy is also reflecting these pressures. The Reserve Bank of India has raised its key interest rate by 25 basis points to 5.50% in an effort to contain inflation and bring it closer to the central bank's 4% target. Higher interest rates, however, can also constrain investment and consumption, complicating the government's challenge of creating sufficient employment for a rapidly expanding workforce.

Political tensions are adding another layer of uncertainty. Youth-led protests that initially focused on alleged examination leaks have now expanded to accusations of electoral manipulation. The Election Commission's revision of voter rolls—officially intended to eliminate duplicate, deceased and ineligible voters—has become politically contentious, with opposition groups alleging that the process could benefit the ruling Bharatiya Janata Party (BJP).

Questions about institutional independence are particularly sensitive in the world's largest democracy. Reports that election commissioners themselves have objected to certain decisions, coupled with the Supreme Court seeking explanations from the BJP and Election Commission over voter-roll changes, have intensified public scrutiny.

Meanwhile, protests in New Delhi following the alleged rape of a young woman have highlighted another deeply troubling issue: women's safety. Public anger becomes particularly potent when citizens believe government officials are dismissive of their concerns.

India's challenge is no longer simply to sustain high economic growth. It must ensure that growth translates into jobs, purchasing power, institutional credibility and personal security. Economic statistics can impress investors, but social stability ultimately depends on whether ordinary citizens believe that the system works for them.

Oil Supply and Price: What Is the Reality?

For decades, we have been taught a simple economic principle: prices are determined by demand and supply. But crude oil tells a different story. Demand and supply matter, yet they do not, by themselves, determine the price consumers ultimately pay.

I was confronted with this question in 2005 when an anchor of a leading business channel asked me live, what drives crude oil prices? My instant response was, “Crude oil prices are not driven by demand and supply alone; there are other factors which analysts either do not discuss or do not know.” After the program, the anchor remarked, “Kazmi Sahib, your white hairs do not mean people will accept your absurdity.”

Two decades later, the question deserves to be revisited.

Today, Middle Eastern crude exports have recovered to, and on some days exceeded, pre-war levels despite continuing disruption around the Strait of Hormuz. Yet Brent remains above US$100 a barrel. At the same time, Saudi Aramco has cut November crude prices for Asian buyers to a six-year low, while G7 countries have agreed to release 100 million barrels of crude and diesel from emergency reserves.

If supply alone determines price, such developments should have produced a much sharper decline.

The missing piece is the financial market. Crude is priced through highly sophisticated benchmark and futures markets in which fund managers, commodity traders, banks, physical traders and financial institutions constantly buy and sell expectations about future supply, demand and geopolitical risk. Brent futures are cash-settled, meaning positions can be closed financially without physical delivery. Yet those financial markets remain closely connected to physical benchmark pricing.

This creates a powerful feedback loop. Financial-market movements are reported almost hourly by major media houses. Headlines influence expectations; expectations influence trading; trading influences benchmarks; and benchmarks influence the prices paid for physical crude.

The result is that oil producers do not necessarily determine the price of their own product. Saudi Arabia, Russia, the United States and other producers can influence supply, but the marginal price is increasingly shaped by a financial ecosystem of traders, fund managers, benchmark mechanisms and information flows.

That is why the real beneficiaries of oil-price volatility may not always be producers. They can be the financial intermediaries and speculators positioned to profit from every rise and fall.

Perhaps it is time to ask a more fundamental question, who really sets the price of crude oil—the producers who pump it, or the financial markets that trade expectations about it?

Is Gold Losing Its Glitter?

For centuries, gold has been regarded as a store of value, a hedge against inflation and a refuge in times of uncertainty. Yet 2026 has challenged this conventional wisdom. Gold crossed US$5,000 per ounce in January 2026 before retreating sharply. The decline raises an intriguing question, is gold losing some of its traditional glitter?

Several factors may explain this reversal.

First, central banks were major buyers of gold during the global drive to diversify reserves and reduce dependence on the US dollar. Any slowdown in this accumulation could weaken an important source of demand. However, it would be premature to conclude that central banks have stopped accumulating gold.

Second, higher oil prices increase the dollar requirements of oil-importing countries. Governments also need foreign exchange to build strategic reserves and meet external obligations. In such circumstances, liquid dollar reserves may take precedence over additional gold purchases.

Third, geopolitical uncertainty can have an unexpected impact. Gold is traditionally considered a safe haven, but crises also create an urgent need for immediately deployable liquidity. The US dollar, backed by deep and liquid financial markets, can therefore compete directly with gold for safe-haven demand.

Fourth, persistent inflation creates a paradox. Although inflation can support gold as a hedge, rising food, energy and housing costs erode household purchasing power. Families facing higher living expenses may simply have less surplus cash to invest in gold.

Fifth, the increasing availability of bank financing against jewellery may change household behaviour. Instead of selling gold to meet urgent cash requirements, owners can pledge jewellery as collateral while retaining the underlying asset.

Finally, buoyant equity markets can divert investment flows. When stocks and other risk assets promise attractive returns, investors may prefer them to non-yielding gold and gold-backed funds.

None of these factors alone explains the decline. Together, however, they suggest that the investment environment surrounding gold may be changing.

Perhaps gold has not lost its glitter. Perhaps, for the moment, liquidity has become as valuable as a safe haven. The real question is whether this is merely a correction after an extraordinary rally—or the beginning of a structural change in the way investors value gold.