White House Unveils ‘New’ AI and Energy Deals with Gulf States

The Trump administration unveiled a series of high-profile deals spanning the AI and energy sectors with the United Arab Emirates (UAE) on Thursday, May 15, 2025, at 11:03 PM +04, sparking optimism about economic collaboration. However, despite the enthusiastic tone from administration sources, many of these agreements appear to be extensions or re-announcements of initiatives already in progress since January, raising questions about their novelty and immediate impact on the US economy. With details such as specific dollar figures, timelines, and implementation strategies remaining vague, the true scope and benefits of these partnerships remain shrouded in uncertainty as markets assess their potential at 12:20 AM +04 on Friday, May 16, 2025.

Among the highlighted arrangements is an “AI acceleration partnership agreement” between the US and UAE, coinciding with a recent deal between a prominent AI developer and Saudi Arabia to establish large-scale data centers under the oversight of the kingdom’s sovereign wealth fund’s new AI investment arm. This Saudi initiative, linked to a high-profile smart city project, aligns with the UAE’s ambitions, though the administration’s lack of clarity on how these deals will boost US growth leaves investors cautious. Another touted achievement includes a pledge of nearly $200 billion in US-UAE deals, alongside an accelerated commitment of $1.4 trillion over ten years—equivalent to 27% of the UAE’s annual GDP—though the feasibility and execution plan for such a massive investment remain unexplained.

Further announcements included a “sovereign cloud launchpad” collaboration between a leading tech firm and the UAE’s cybersecurity body, a project already in development for the region’s digital initiatives, suggesting little new commitment from the US side. Additional deals involve a critical minerals agreement for gallium production to support counter-drone technology manufacturing in the UAE, as well as an expanded oil and natural gas production pact with UAE energy firms. These follow a decade-long aerospace agreement and a $4 billion aluminum project in Oklahoma, both of which appear to build on existing UAE investments in US refining and industrial assets dating back to 2024, casting doubt on their status as fresh economic drivers.

The US stock market responded with mixed signals, with the S&P 500 up 0.3% to 5,901 points and the Dow gaining 121 points to 42,377 points on Thursday, reflecting cautious optimism amid these announcements. The Nasdaq dipped 0.07% to 18,966 points, indicating selective investor sentiment, possibly due to uncertainty over the deals’ tangible benefits. The US Dollar Index (DXY) held steady at 100.88, showing little immediate reaction, while gold prices rebounded to $3,202, suggesting safe-haven demand persists amid unclear economic impacts. As the administration navigates these partnerships, their ability to deliver measurable economic growth and strengthen the USD will depend on clearer strategies and execution, with markets watching closely for signs of progress in the coming months.