Privatization initiatives are a central component of ongoing economic diversification efforts in the oil- and gas-producing member states of the Gulf Cooperation Council (GCC). The Abu Dhabi National Oil Co. – the largest energy producer in the United Arab Emirates (UAE) – raised more than $10 billion in 2020 by selling a 49% in its gas pipelines. Government-related entities (GREs) in other regional states have considered taking similar steps. Recent natural gas discoveries across the Gulf region present new opportunities for privatization initiatives and related commercial partnerships with the private sector. However, volatile gas prices and uncertain global energy demand have forced prospective investment partners to proceed with caution. This paper argues that domestic factors influence the trajectory of natural gas asset privatizations in Gulf Arab states as much as global market forces. GCC policymakers and officials pursuing privatization initiatives must grapple with controversial issues related to public resources. Privatizations also possess direct implications for state revenues in a region wherein the oil and gas sector often accounts for more than 70% of total government income. Guaranteed, one-off transactions must be weighed against greater commercial control over uncertain revenue streams in the future. The imposition of new tax regimes and persistence of subsidies reduce the profitability of Gulf gas assets and likewise affect their value on international markets. Moreover, the aims behind various pushes to develop self-sufficiency in natural gas consumption do not necessarily align with privatization objectives. This paper adds a new scholarly dimension to two related fields: i) the political economy of energy dynamics in Gulf Arab states and ii) state-business relations in the Middle East. Natural gas is considered a bridge energy source in the transition from oil to cleaner, renewable energy sources. Therefore, natural gas dynamics within gas-producing states are central to understanding the nature of energy transitions globally. The political economy approach of this paper is inherently interdisciplinary and thus relies on insights from economics, political science, and law. However, the work is predominantly shaped by a political science lens that emphasizes the interplay between institutional frameworks and human (and firm-level) behavior in order to explain local development outcomes. The paper relies heavily upon personal interviews with leading gas and energy experts in the U.S., Europe, and Gulf Arab states. A version of this paper will be a chapter in an edited volume, Natural Gas and Global Energy Transitions, that Palgrave MacMillan intends to publish in 2022.