Qatar sells first international bond since November as deficit hits nearly decade-high

Qatar just returned to international bond markets for the first time in ten months, offering USD-denominated debt across two tranches as the Gulf state grapples with a fiscal hole that would make most finance ministers lose sleep. The Ministry of Finance priced a 5-year bond at 85 basis points over US Treasuries, yielding roughly 5.67%, alongside a 10-year tranche at 95 basis points over, coming in around 5.91%. Both are set to list on the London Stock Exchange. A deficit that demands attention The timing is not coincidental. Qatar’s Q2 2026 budget deficit ballooned to 21.2 billion riyals, approximately $5.8 billion, marking the largest quarterly shortfall the country has seen in nearly a decade. The culprit is straightforward: the US-Iran conflict has effectively choked off traffic through the Strait of Hormuz. Qatar has seen its LNG shipments collapse from roughly 20 million tons per quarter before the conflict to less than 2 million tons in the April through June period. That’s a 90% drop. Revenue fell by approximately 30% year-over-year as a result. Government spending, meanwhile, stayed roughly flat. Before going public with this issuance, Qatar had been raising money more qui...