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Share prices in Gulf states falls steeply after economic sanctions on Iran lifted

Share prices in oil-rich Gulf states have dropped sharply after the lifting of economic sanctions on Iran.

The Saudi Arabia Stock Exchange fell 5.4% on Sunday, while the Qatar Exchange closed down 7% and Dubai’s stocks dropped 4.6%.

Those exchanges are dominated by energy firms who fear oil will fall further from its current 12-year low of $29 when Iran resumes oil exports.

Emirati investors follow the movement of stock prices at the Dubai Financial Market on October 12, 2008. Stock markets in the energy-rich Gulf states opened the week's trading today sharply down with the Dubai Financial Market shedding six percent. AFP PHOTO/MARWAN NAAMANI (Photo credit should read MARWAN NAAMANI/AFP/Getty Images)

Iran has said it will sell up to 500,000 extra barrels of crude oil.

Economic sanctions, in place for nearly 40 years, were lifted after inspectors confirmed on Saturday that Iran had taken the required steps to limit its nuclear programme.

Investors reacted immediately in the first day of trading in the Muslim week.

The Saudi Tadawul All Share Index, the largest market in the region, dropped during trading to its lowest level since early 2011, closing at 5,520 points.

Share prices in all six of the other Gulf stock exchanges also dropped, as investors weighed up a stronger Iranian economy and extra oil in an already over-supplied market.

Saudi Arabia’s oil minister Ali al-Naimi said it would take “some time” to restore stability to the global oil market, but added that he remained optimistic.

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