Updates with closing prices and analyst comments

By Amna Mariyam and Md Manzer Hussain

May 18 (Reuters) - Gulf equities fell on Monday, tracking a global selloff from conflict in the Middle East after the United Arab Emirates said drones had targeted an area near its Barakah nuclear power plant and Saudi Arabia said it had intercepted three drones.

The UAE's defence ministry said it had intercepted two drones and was investigating the source of the attack, while a third drone struck near the Barakah facility.

It said the drones were launched from the "western border", without providing further details.

Saudi Arabia said the three drones it intercepted had entered from Iraqi airspace and warned it would take necessary measures against any attempt to violate its sovereignty.

Oil prices climbed to two-week highs as efforts to end the U.S.-Israeli war on Iran appeared to stall, adding to a broader selloff across global markets.

In Dubai, the main share index .DFMGI fell for a seventh straight session, its longest losing streak in more than two years, and closed 1.7% lower. Losses were led by real estate, industrial and consumer discretionary stocks.

Blue-chip developer Emaar Properties EMAR.DU dropped 3.6%, Dubai's largest lender Emirates NBD ENBD.DU lost 1.7%, and budget carrier Air Arabia AIRA.DU declined 3.3%.

In Abu Dhabi, the index .FTFADGI dropped 1.2%, with all sectors ending in negative territory, led by technology, utilities and real estate. Abu Dhabi Commercial Bank ADCB.AD shed 4.9%, while Aldar Properties lost 3%

"Despite the short-term downside risks, the markets could continue to see long-term upside potential, with support from large investment initiatives such as plans from (Abu Dhabi state oil firm) ADNOC to increase production levels, as well as large-scale government initiatives such as the UAE-Oman corridors and crude pipeline capacity expansion," said Milad Azar, market analyst at XTB MENA.

The Qatari benchmark .QSI fell 1.1%, weighed down by losses across all constituents. Qatar National Bank QNBK.QA, the region's largest lender, slipped 1%, while Industries Qatar IQCD.QA slid 1.3%.

Saudi Arabia's benchmark .TASI eased 0.1%, extending losses to a fifth straight session, pressured by industrial, consumer staples and materials stocks. Saudi Arabian Mining Company 1211.SE fell 1.5%, and Riyad Bank 1010.SE slipped 1.2%. Saudi Chemical Holding 2230.SE gained 4.2% after announcing a military materials supply agreement with the National Company for Mechanical Systems.

"The Saudi market remained under some pressure but could find support from the energy sector and elevated oil prices," Azar added.

Outside the Gulf, Egypt’s blue-chip index .EGX30 declined 0.7%, with Commercial International Bank COMI.CA down 1.1% and Fawry for Banking Technology FWRY.CA losing 2%.

SAUDI ARABIA	.TASI down 0.1% to 10,956
KUWAIT	.BKP down 0.4% to 9,161
QATAR	.QSI lost 1.1% to 10,372
EGYPT	.EGX30 eased 0.7% to 52,007
BAHRAIN	.BAX fell 0.7% to 1,920
OMAN	.MSX30 dropped 2.4% to 7,749

ABU DHABI

.FTFADGI down 1.2% to 9,561

DUBAI

.DFMGI declined 1.7% to 5,610