Saudi Economy Contracts for First Time in Over Two Years

Saudi Arabia's economy experienced its first contraction in over two years, according to preliminary data. The country's GDP contracted 4.8% year-on-year in the second quarter of 2026, reversing the 3.0% expansion seen in the previous quarter.

The decline was largely driven by a sharp drop in oil activities, which fell 24.7% year-on-year and accounted for a 5.4 percentage point subtraction from overall GDP growth. Non-oil activities and government activities continued to expand, albeit at slower rates.