Horizons Middle East & Africa 8/22/2025

Morgan Stanley projects further upside in gold, driven by a weakening U.S. dollar, indicating a potential investment theme for institutional portfolios. Concurrently, billionaire Aliko Dangote is making strategic moves to dominate oil refining, signaling a significant shift in market dynamics within the Middle East and Africa region.

Analysis

Morgan Stanley has identified a key macro-driven investment theme, forecasting further upside potential for gold prices based on an expected decline in the U.S. dollar. This establishes a direct causal link for investors monitoring currency and commodity markets. Simultaneously, a significant structural shift is occurring in the African energy market, where billionaire Aliko Dangote is making a strategic play to dominate oil refining. This initiative points to a major disruption in regional supply chains and presents a long-term development for emerging market specialists to track. These financial and industrial narratives are unfolding against a backdrop of geopolitical uncertainty, as suggested by commentary on potential shifts in U.S. foreign policy, which could serve as a volatility catalyst for both currency and energy markets.

Key Decisions for Investors

• Investors could consider long positions in gold or gold-related instruments as a direct play on the anticipated weakness of the U.S. dollar outlined by Morgan Stanley.
• It is prudent to monitor the competitive landscape and value chain in the African energy sector for potential dislocations and opportunities created by Dangote's move to dominate the refining market.
• Factor in geopolitical developments, especially regarding U.S. policy on global conflicts, as a key variable that could significantly impact both USD valuation and commodity price trends.