Chinese autonomous driving firm WeRide WRD.Ohas suspended its robotaxi fleet in Dubai as the escalating U.S.-Israel conflict with Iran roiled key Middle Eastern hubs that have emerged as the robotaxi industry's most promising markets.

Chinese robotaxi firms have flocked to the Gulf over recent years as one of their first overseas expansion outposts, attracted by a friendly regulatory environment and robust demand for ride-hailing services.

WeRide, which has been operating robotaxi services in the region since 2021, said on Tuesday that its robotaxi fleet in Abu Dhabi and Riyadh is continuing regular public commercial operations and passenger operations.

All of its employees in the region are "currently working from home and limiting unnecessary outings to ensure their safety and well-being."

Two other Chinese robotaxi majors, Baidu's 9888.HK Apollo Go and Pony.ai PONY.O, are both monitoring the situation in the region.

Apollo Go was "in close coordination with local regulators and will adjust our services as needed to ensure the continued safety of our staff and an orderly response to the local environment," a company statement said.

The robotaxi unit of Baidu launched commercial robotaxi services in Abu Dhabi in January.

Pony.ai had suspended its on-road testing activities in Doha and Dubai before resuming testing in Doha on Monday.

It will resume testing in Dubai "at an appropriate time," according to the company, which remains at the testing stage in the region.

-Qiaoyi Li, Zhang Yan and Brenda Goh/Reuters