War exposes new risks for the Gulf’s AI infrastructure push

While hostilities in the Middle East began less than two weeks ago, Iran’s attacks on the infrastructure of Gulf countries – Bahrain, Kuwait, Oman, Qatar, Saudi Arabia, and the United Arab Emirates (UAE) – have put the vulnerability of its data centers into the spotlight. Drone strikes have hit three Amazon Web Services (AWS) data centers in the region, with one facility targeted just 24 hours into the conflict.

Image credit: Made by Miguel Cordon/Tech in Asia with the help of AI

The outages have had a profound effect in the region. Popular platforms like super app Careem were out of action for several hours, Anthropic’s AI tool Claude was unusable locally, and Epic Games announced latency issues for its Fortnite game. Abu Dhabi Commercial Bank, a major player in the UAE’s finance sector, announced on March 2 that its mobile banking and contact center services were offline, but they were fully restored after 48 hours.

These data centers also serve AWS customers across Africa, South Asia, and Southeast Asia. The company has recommended that customers migrate workloads to alternative AWS facilities globally.

See also: PH bets on local data centers. Can it handle the heat?

Aside from exposing the vulnerability of the Gulf’s data center industry, the outages highlighted how reliant governments, businesses, and the public are on digital services.

They also pose a deeper question: Do the region’s ambitions to become a global hub for AI infrastructure now carry a new geopolitical risk premium?

The buildup

The Gulf’s investments in AI and data centers over the past 12 months have made headlines globally.

In May 2025, Saudi Arabia, Qatar, and the UAE pledged over US$2 trillion to make the Gulf a global center for AI on a similar level to China and the US. Hyperscalers such as Google, Meta, Microsoft, and Oracle have promised to ramp up their investments in the region (all of them have or use facilities in the Gulf) and partner with national projects such as Stargate UAE or Humain, a Saudi Arabian AI firm.

In effect, the Gulf’s data center industry would go from a regional player serving customers across Africa and Asia to a global hub. But the war will disrupt supply chains and construction, slowing these plans regardless of the commitment from the Gulf’s governments.

Given the huge investments being funneled into the sector, data centers could be redesigned to reduce risk. The AWS disruptions are a case in point, stressing the risks of concentrating critical infrastructure in a handful of locations.

The size and scope of data centers are another factor. Based on information collected by analyst house MEED Projects, there are roughly 185 data centers in the Gulf, each one with a capital expenditure value of over US$10 million. Of this total number, 99 facilities are either currently under construction or are in the planning stages.

Most of the data centers in the region were built to cater to enterprise demand from industries like finance, where locally based facilities are preferred for security and data hosting requirements. While the exact locations of these data centers are not disclosed, they are often in industrial areas.

The concentration of data centers in Saudi Arabia and the UAE emphasizes how much of the Gulf’s digital infrastructure and its AI ambitions are tied to a small number of locations.

Stick or twist