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2026-11-04 19:28:26
[Saudi Arabia's GDP Contracted by 4.1% Year-on-Year in Q3 2026, Oil Industry Dragging Down Economic Weakness] ⑴ Data from the Saudi General Authority for Statistics shows that the country's real GDP declined by 4.1% year-on-year in the third quarter, marking the second consecutive quarter of annual contraction, with overall economic downward pressure continuing to increase. ⑵ The core factor dragging down the economy was the oil sector, which contracted by 21.3% year-on-year, while government economic activity declined by 3.0%; non-oil industries bucked the trend, growing by 2.2%, which to some extent offset the overall economic decline. ⑶ On a quarter-on-quarter basis, the economy showed signs of recovery, with seasonally adjusted GDP rising by 1.5% in the third quarter, reversing the sharp 5.1% quarter-on-quarter decline in the second quarter. ⑷ The quarter-on-quarter recovery mainly relied on the rebound in oil business, with oil activity rising by 6.1% quarter-on-quarter, and non-oil industries growing slightly by 0.7%; government spending continued to contract by 1.4% quarter-on-quarter. ⑸ In terms of growth contribution, the oil industry dragged down the overall growth rate by 5.0 percentage points, and government activity by 0.5 percentage points; non-oil industries and net tax revenue contributed 1.3 and 0.2 percentage points to economic growth, respectively. (6) Oil price fluctuations and crude oil production control remain the biggest variables for the Saudi economy. Although non-oil industries have maintained positive growth, they are unlikely to fully offset the impact of the downturn in the oil industry in the short term.
