Saudi Economic Outlook Dips on Oil, Aviation

Preliminary estimates point to a weaker economic outlook for Saudi Arabia in 2026, driven by lower oil activity and a period of aviation disruption that affected flights across the Kingdom. Forecasts for real GDP growth now range widely, from about -3.6% to +1.7%, depending on the assumptions and the date of each update.

The Ministry of Finance's preliminary estimate puts real GDP growth at around -3.6% in 2026, compared with the earlier budget assumption of +4.6%. The ministry expects oil activity to fall by roughly 11.4% in the first half of 2026, while non-oil activity is projected to grow 3.2% over the year.

Average oil production reached about 8 million barrels down 12.4% year on year. A separate central bank report cited a 24.8% decline in oil activity and average crude output of about 6.7 million barrels

Why it matters to the community

A spell of aviation disruption led to widespread cancellations at Saudi airports, with departures from Riyadh particularly affected and reported cancellations exceeding 40% during the disruption. King Khalid International Airport in Riyadh was reported closed through 17 October 2026.

The disruption reduced aviation activity, weakened business confidence, and added further pressure to the economic outlook. For residents and expats, the figures signal a more cautious near-term environment, even as the non-oil economy is still expected to expand over the year. Saudi Living will continue to track updated estimates as they develop.

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