Saudi Economy Shrinks 4.8% in Second Quarter Amid Oil Output Drops

The Saudi economy has experienced its first quarterly contraction since 2023, according to government estimates. The General Authority for Statistics reported that real GDP shrank by 4.8% year-on-year in April, May, and June.

This downturn was largely driven by a 25% fall in oil activity, due in part to Saudi Aramco's production cuts following the closure of the Strait of Hormuz, its primary export route.

Monica Malik, chief economist at Abu Dhabi Commercial Bank, noted that 'what's actually more important is oil revenue, because that's what feeds into the fiscal budget.'