Happy Monday everyone!

Energy markets are in turmoil as Iran signals a closure of the Strait of Hormuz following the death of Supreme Leader Ali Khamenei, with vessel traffic plummeting 70% and insurance premiums rising 50%. Despite a federal ban, the U.S. military reportedly used Anthropic’s Claude model to coordinate the strikes, highlighting the model's critical role even as the company maintains a $380 billion valuation. Simultaneously, Sam Altman has pivoted OpenAI toward a landmark Department of War contract, sparking a viral #QuitGPT movement and a historic $40 billion funding round as the company embraces a new era of "AI defense."

In the wake of these developments, we hope everyone stays safe. At this critical moment, it is essential to remain united and follow guidance issued by official authorities. We will continue providing verified updates as they unfold.

WhatsApp | Instagram | Tiktok | Smashi Business Show (Mon-Friday)

Markets

US, Israel Attack Iran — Summary

• The US and Israel launched coordinated strikes on Iran, with explosions reported in Tehran.

• President Trump said the US has begun “major combat operations,” describing it as a planned multi-day military campaign.

• Iran retaliated with missile fire toward Israel.

• The UAE intercepted two waves of Iranian attacks; one Pakistani civilian was killed by falling shrapnel.

• The UAE condemned the strikes and warned of “grave consequences.”

• Bahrain, Kuwait and Qatar confirmed intercepting Iranian missiles. Each hosts a US military base.

• Several countries across the region have closed airspace amid the escalation.

• Saudi Arabia condemns attacks on Bahrain, Qatar, Jordan and Kuwait.

• Multiple airlines suspended flights to Iran, Israel and Iraq. Some Dubai flights were cancelled or rerouted. Emirates temporarily suspended select operations.

• Iran’s National Security Council urged residents to leave Tehran.

Global Energy Markets Brace for Impact as Iran Signals Hormuz Closure

What Is It About?

Iran has effectively shuttered the Strait of Hormuz following a massive joint military strike by the United States and Israel—an operation codenamed "Roaring Lion"—which resulted in the death of Supreme Leader Ayatollah Ali Khamenei. While Tehran has not issued a formal decree, the UK Maritime Trade Operations (UKMTO) and EU naval missions confirmed that vessels in the Gulf are receiving VHF radio warnings from the IRGC stating the waterway is closed. The New York Times reports a 70% drop in traffic, with a "flotilla" of tankers now anchored near Fujairah to avoid the escalating conflict.

Why It Matters?

The Strait of Hormuz is the world’s most critical maritime chokepoint, carrying roughly 20% of global oil and a fifth of all liquefied natural gas (LNG), primarily from Qatar. The Financial Times reports that war-risk insurers have already begun issuing cancellation notices, with remaining premiums expected to surge by 50%. Analysts warn that a prolonged blockade could send crude prices screaming past $100 per barrel, potentially hitting $140 in a worst-case scenario, threatening to reignite global inflation.

What’s Next?

Markets are watching for a formal declaration from Iran's new interim council. If the "practical closure" becomes a long-term blockade, the U.S. Navy may intervene to forcibly reopen the shipping lanes, risking a direct "hot war." Investors should monitor Brent crude futures and vessel tracking data for signs of a total halt. With Japan and South Korea sourcing over 80% of their energy through the strait, expect immediate diplomatic pressure from Asian economies to de-escalate.

Pentagon Deploys Anthropic’s AI in Iran Strike Despite Trump Ban

What Is It About?

In a startling contradiction of federal orders, the U.S. military utilized Anthropic’s Claude AI model to coordinate a high-stakes strike on Iran just hours after President Trump ordered an immediate ban on the technology. According to The Wall Street Journal, U.S. Central Command leveraged the system for intelligence assessments and target identification during the operation that killed Supreme Leader Ayatollah Ali Khamenei. The administration had recently designated Anthropic a security risk after CEO Dario Amodei refused to grant the Pentagon unrestricted military use, specifically citing ethical "red lines" against autonomous weapons and mass surveillance.

Why It Matters?

This incident exposes a deepening rift between the White House and the defense establishment, which remains heavily reliant on frontier AI for modern warfare. While Trump labeled the firm "leftwing nut jobs," the military’s continued use of Claude suggests it is currently irreplaceable in classified workflows. Economically, the friction has only bolstered Anthropic’s market position; the company recently raised $30 billion at a staggering $380 billion valuation, backed by powerhouse investors like Abu Dhabi’s MGX and the Qatar Investment Authority.

What’s Next?

Expect a period of extreme volatility for defense contractors as the Department of War begins a mandated six-month phase-out of Anthropic tools. OpenAI has already moved to fill the vacuum, signing a deal to deploy its models on Pentagon networks. Watch for a legal showdown as Anthropic prepares to contest its "supply chain risk" status in court—a move that could define the boundaries of private sector ethics versus national security mandates.

OpenAI Under Fire: #QuitGPT Viral as Altman Secures Pentagon Deal

What Is It About?

A digital rebellion is brewing against OpenAI following a landmark deal with the U.S. Department of War (DoW) to deploy its models for military use. The partnership coincided with unprovoked U.S.-Israeli airstrikes in Iran that killed Supreme Leader Ali Khamenei. While Anthropic CEO Dario Amodei rejected similar terms—leading President Trump to blacklist the firm as a national security risk—Sam Altman stepped in to sign the contract. Despite Altman’s claims on X that the agreement includes "technical safeguards" and "prohibitions on domestic mass surveillance," users have launched the #QuitGPT campaign, triggering a wave of subscription cancellations and a mass migration to Claude.

Why It Matters?

This pivot signals a definitive end to the "AI safety" era of Silicon Valley and the dawn of the "AI defense" age. OpenAI recently closed a $40 billion funding round—the largest in history—valuing the company at $300 billion. Backed by SoftBank, Microsoft, and Thrive Capital, the firm is now inextricably linked to U.S. geopolitical strategy. By filling the vacuum left by Anthropic, OpenAI has secured its status as the "defense prime" of the software world, but at the cost of its once-unassailable brand trust among retail users.

What’s Next?

Watch for a bifurcated AI market: a "defense-grade" sector led by OpenAI and a "principled" sector led by Anthropic, which reached No. 1 on the App Store overnight. Analysts are monitoring whether the #QuitGPT movement will materially impact OpenAI’s bottom line or if the massive DoW contract renders consumer churn irrelevant. Expect Congress to hold hearings on the "human responsibility" clauses in these contracts as the risk of autonomous warfare moves from sci-fi to reality.

🦄 World of Startups

• Stake Raises $31M Series B Led by Emirates NBD, Total Funding Hits $58M

• US-based Luma AI is planting its flag in Riyadh — opening a regional headquater

• Singapore's Ascentium continues its aggressive expansion, acquiring UAE legaltech pioneer Clara in a strategic Middle East play

• Abu Dhabi is quietly becoming one of the most influential financiers of the global AI race, with its latest participation in Anthropic’s massive $30B funding round

• Safqah Capital has just closed one of Saudi Arabia’s largest-ever seed rounds, raising $15.2 million in a deal that was four times oversubscribed

👨‍💻From Smashi Business’ Desk

• UAE Successfully Intercepts Iranian Missiles, Naguib Sawiris Voices Support

• HH Sheikh Khaled bin Mohamed bin Zayed met Indian Prime Minister Narendra Modi on the sidelines of the AI Impact Summit in New Delhi.

• Humain, the artificial intelligence arm of the Public Investment Fund, invested $3 billion in xAI during its Series E round

• Saudi Prince Alwaleed bin Talal’s combined stake across Elon Musk’s companies has reached an estimated $9.2 billion.

🔍In other news…

• DMCC Unveils Intellectual Property Framework to Lift Valuations Across 26,000 Member Firms

• Gulf-Backed OpenAI Raises $110 Billion From Amazon, NVIDIA and SoftBank

• Syria’s Central Bank Launches Reform Review With U.S. Consultant to Restore Global Credibility

• ADIA in Investment Talks With Bezos-Led Project Prometheus

• Saudi Reserves Climb to Highest Since 2022 on Oil, Debt Sales

🗓️ Plan Your Events (March-April 2026)

UAE

• 31 March - 2 April (Tuesday-Thursday): Arab Media Summit, Dubai.

• 26-28 March (Thursday-Saturday): Social Capital Conference, Dubai.

• 7-9 April (Tuesday-Thursday): Future Health Summit, Adnec Center Abu Dhabi.

• 13-15 April (Monday-Wednesday): AIM Congress, Dubai World Trade Center.

• 14-16 April: (Tuesday-Thursday): the International Property Show, Dubai World Trade Center.
  

Saudi Arabia

• 13-16 April (Monday-Thursday): Leap Tech Conference, Riyadh Exhibition & Convention Center - Malham.

• 20-22 April (Monday-Wednesday): Sports Investment Forum (SIF), Riyadh

Egypt

• 30 March – 1 April (Monday-Wednesday): Egypt International Energy Conference and Exhibition (EGYPES).

Latest Episode of The Smashi Business Show

Apple | Spotify | Youtube | Anghami | Smashi TV

Were you forwarded this email? Subscribe here