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Tuesday, April 23, 2024

Saudi Arabia’s Economy Shrinks Again Due to Oil Production Cuts

According to preliminary estimates released by the General Authority for Statistics on Wednesday, Saudi Arabia experienced a 3.7% year-on-year contraction in real GDP during the fourth quarter, marking a milder decline compared to the 4.4% drop observed in the third quarter.

The downturn was primarily attributed to a 16.4% decrease in oil-related activities, whereas non-oil activities and government sectors expanded by 4.3% and 3.1% year-on-year, respectively.

Also Read: Saudi Arabia Unveils 2034 World Cup Clifftop Stadium Design

Government data indicates that the overall contraction for the entire year was 0.9%. Throughout the year, the world’s largest crude exporter implemented output cuts to boost prices. Additionally, Saudi Arabia took on a significant share of voluntary crude production cuts, agreed upon by certain members of the Organization of the Petroleum Exporting Countries and its allies.

It’s worth noting that the Saudi economy heavily relies on its petroleum sector, constituting 42% of its GDP.

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