Saudi Arabia GDP Growth Rate Revised Up in Q4

Saudi Arabia’s economy expanded 3.0% year-on-year in the first quarter of 2026, revised higher from a preliminary estimate of 2.8% but slowing from 5.0% growth in the previous period. This marks the softest economic expansion since the second quarter of 2024, as growth in oil activities slowed to 2.9% from 10.8% in Q4, pressured by ongoing US–Iran tensions that disrupted shipping through the Strait of Hormuz, a critical chokepoint for about 20% of global oil and LNG trade. Non-oil activities also rose at a softer pace of 2.9%, down from 4.6% in the prior quarter. Meanwhile, government activities rebounded by 1.5%, following a 1.2% contraction in the previous period. On a quarterly basis, the economy contracted by 1.2% in Q1, primarily due to a 6.8% decline in oil activities, which was partially offset by increases of 1.4% in government activities and 0.3% in non-oil activities.

Saudi Arabia’s economy expanded 2.8% year-on-year in the first quarter of 2026, slowing sharply from a 5% growth in the previous quarter, preliminary data showed. This marked the weakest pace of expansion since the second quarter of 2024, weighed down by tensions between the US and Iran that disrupted shipping through the Strait of Hormuz, a key route for roughly 20% of global oil and LNG supply. Growth in non-oil activities (2.8% vs 4.3% in Q4) and oil activities (2.3% vs 10.8%) decelerated sharply. Meanwhile, government activities rose 1.5%, rebounding from a 1.2% decline in the prior period. On a quarterly basis, GDP fell 1.5%, the first decline since the third quarter of 2023, following a 1.4% increase in the previous quarter. The IMF noted that the country is expected to be less heavily affected by the conflict than other Gulf states, given its ability to reroute part of its exports through alternative channels, alongside the relative resilience of its non-oil industrial sector.

Saudi Arabia’s economy grew 5% year-on-year in Q4 2025, marking the fastest pace in a year and slightly above preliminary estimates of 4.9%, following a 4.8% rise in Q3. The non-oil sector expanded 4.3%, the same as in the previous quarter, while the oil sector surged 10.8%, up from 8.3% in Q3. By activity, crude petroleum and natural gas extraction posted the largest gain in Q4 (12.4%), followed by wholesale and retail trade, restaurants, and hotels (5.4%), petroleum refining (5%), manufacturing excluding petroleum refining (5%), and finance, insurance, and business services (4.5%). Government activities, in contrast, contracted 1.2%, after a 1.4% rise in Q3. For the full year 2025, Saudi Arabia’s economy expanded 4.5%, accelerating from 2.7% growth in 2024.