Beyond Force Majeure: Hardship and Change-in-law Lifelines for Saudi Contractors After Hormuz Closure (2026 Keyword Guide)

It is tempting to treat every delay as a force majeure problem, but Saudi-law-linked analysis draws a sharper line between “impossible” and “excessively onerous.” DWF Group explains that a complete closure preventing delivery of essential equipment may fit force majeure or other exceptional event provisions and justify an extension of time, while diversion or longer routes are less likely to entitle relief if completion is not delayed. Under Saudi Arabia’s Civil Transaction Law (CTL), Article 110 frames force majeure as impossibility beyond the debtor’s control, extinguishing reciprocal obligations. By contrast, BD Law summarises Article 97 as hardship: extraordinary unforeseeable events that make performance excessively onerous, triggering an invitation to negotiate without undue delay, and potentially adaptation or termination if renegotiation fails.

Hardship, Change-in-Law, and EOT: Picking the Route That Fits

Cost pressure alone can push contractors toward hardship rather than force majeure. Ontier estimates the landed cost of imported construction materials in Saudi Arabia has risen by 25–40% since late February 2026, while it also reports Brent crude has surged past US$126 per barrel and that Gulf-bound hull war premiums have quadrupled to about 1% of vessel value for seven days’ cover. Yet Pinsent Masons cautions that, in practice, Middle East construction contracts often allocate general inflation and commodity volatility risk to the contractor, especially under lump-sum models, and many amended force majeure clauses explicitly exclude economic hardship. That combination makes it critical to frame claims around the contract’s actual relief mechanism—hardship renegotiation where performance remains possible, and EOT where delay to completion can be shown.

Change-in-law is another route, but it is narrower than many teams assume. Pinsent Masons notes that change in legislation clauses typically grant relief if a new law or regulation after contract execution affects costs, and that the current oil price spike is driven by geopolitical events rather than a change in law in the project’s country. Even where war-related government orders or directions exist, whether they qualify depends on drafting. Bird & Bird similarly advises Saudi-facing projects to test disruption against force majeure, hardship, change-in-law, extension-of-time, and cost provisions, because many real problems sit in a “middle ground” like supply-chain rerouting, customs issues, sanctions exposure, and increased insurance costs. The practical message is procedural: choose the best-fitting route early, because missed notices, weak records, or continuing performance without reservation can erode rights.

For extension-of-time claims, causation remains the centre of gravity. DWF Group stresses that entitlement depends on whether disruption actually delayed completion of the works, not just whether logistics became harder or more expensive. Rajah & Tann makes a similar point: an extension of time may be granted where delay is caused by an event beyond reasonable control, but in practice this tends to arise in extreme situations where legal or physical constraints prevent the works, such as prohibitions on export of essential materials or closure of critical routes with no viable alternatives. Against that backdrop, the keyword topic—force majeure, hardship, and Saudi construction contracts in 2026—should be treated as a menu of routes, with evidence-led mapping from event, to clause, to notice, to demonstrable impact on programme.