What Are the US Mid-Terms and Why Are They Important for the Gulf?
Despite the US being embroiled in a war with Iran, most of the political commentary stateside is all about the upcoming mid-term elections.
Americans will go to the polls on Tuesday, November 3.
This year’s vote looks set to be the most significant for years with seismic ramifications in the Middle East. Below, Arabian Business takes you through why that is.
What are the US mid-terms?
The mid-terms take place every two years and are viewed as a litmus test of the performance of the incumbent US President two years into their four-year term in office.
Voters go to the polls to determine the make-up of the House of Representatives and the US Senate, meaning the outcome can determine whether or not Republicans or Democrats control Congress.
Congress has the power to create and pass federal laws that are applied across the nation. So, the battle for control is always an intense one.
A total of 435 seats are up for grabs in the House, and 218 seats are required in order to have the majority.
Meanwhile, 35 of 100 seats in the Senate, the upper chamber, will also be up for grabs.
Both the House and Senate are currently held by the Republican Party but its majority is a slender one.
They have 218 seats in the House, which is the minimum number needed to control it, plus one independent who votes with them.
In the Senate, they have 53 seats. The upper chamber will only change hands if the Democrats win 51 seats, which would overcome a tie-breaking vote by the vice-president – currently a Republican – in the event of both sides getting 50.
If opposition Democrats win back control of at least one chamber, they will gain power to bring their own laws to the floor.
Potential consequences
A lot of political commentators believe that the growing anger at the cost of petrol at the pumps due to the energy crisis, triggered by the US war with Iran, will sway voters towards the Democrats.
Traditionally, voters are typically underwhelmed by the performance of the incumbent President two years into their term, and vote to “punish” at the mid-terms.
A Democratic victory would be significant in many ways, primarily because it would pile pressure on the Trump administration.
What are the main issues?
The cost of living is the key issue.
Trump returned to power in 2024, promising he would fix the economy. However, that has not materialised, and inflation remains well below the target set by the US Federal Reserve.
Undoubtedly, the shock to the global energy sector as a result of the US-Israel war with Iran has had huge economic ramifications.
Democrats have said that, in addition to the war with Iran, Trump’s controversial trade tariffs have only served to drive prices even higher.
Immigration remains a big issue for many voters, especially those of a Republican persuasion, but many of the MAGA movement feel betrayed by Trump for dragging the US into another “forever war” in the Middle East.
Majorie Taylor-Greene, a congresswoman for Georgia in the House of Representatives, was once an ardent supporter of Trump, but she resigned earlier this year over the war in Iran.
Will the result impact the Middle East?
The result of the US mid-term elections most certainly will have an impact on the Middle East.
Republicans are seen as the party of the ‘free market’ – and regularly campaign for lower taxes on businesses, investors and entrepreneurs, who they describe as “wealth creators.”
The Democrats, on the other hand prefer an economic system that promotes more regulated capitalism.
Hussein Sajwani, founder of UAE conglomerate DAMAC, invested $20 billion in US data centres back in January, 2025.
The investment was announced just days before Trump’s inauguration.
The UAE has committed to a 10-year investment framework to the tune of $1.4 trillion.
In May, 2025, Saudi Arabia invested around $600 billion in deals spanning energy, defence, technology and other commercial sectors.
Qatar also announced an investment framework of around $1.2 trillion, and a major deal was the decision by Qatar Airways to purchase Boeing aircraft.
A swing of power in the House of Representatives could have a significant impact on these investments.
It’s important to note that Democrats are not anti-investment or big business, but these deals were all brokered during a Republican presidency.
Wall Street
The financial heartbeat of America will, of course, not be immune to power potentially changing hands in Washington.
Republicans generally prefer lower taxes on businesses, and are big proponents of the free market economy.
If investors anticipate higher corporate taxes as a consequence of a strong Democrat performance, then that could see share prices under pressure.
Elon Musk is a big Republican donor and played a huge part in getting Trump elected in 2024. Despite relations between the two becoming strained, he has still financially backed a number of campaigns in these upcoming mid-terms.
Earlier this week, Musk spoke about combining Tesla and SpaceX into one entity, which would represent the biggest corporate tie-up in history.
The potential merger is projected to be worth $3 trillion, but if Democrats take control, that merger may be put on the back burner.
Who’s in ‘poll’ position?
Some pollsters have said that there is a 72 per cent chance the Democrats will take control of the US House of Representatives, and a 63 per cent chance of them winning the Senate.
Other political commentators and election analysts believe that the Democrats will regain control of the House of Representatives, but many believe the battle for the Senate remains to close to call.
Despite the US being embroiled in a war with Iran, most of the political commentary stateside is all about the upcoming mid-term elections.
Americans will go to the polls on Tuesday, November 3.
This year’s vote looks set to be the most significant for years with seismic ramifications in the Middle East. Below, Arabian Business takes you through why that is.