Saudi GDP Contracts 4.9% in Second Quarter 2026

Saudi Arabia's real gross domestic product (GDP) contracted 4.9% in the second quarter of 2026 compared with the previous quarter, on a seasonally adjusted basis, Measured against the same period a year earlier, the economy shrank 4.8%.

The decline was driven largely by weakness in the oil sector. Oil activity fell 21.5% quarter-on-quarter and dropped 24.7% year-on-year, marking the main factor behind the overall contraction.

Non-oil activity showed a more mixed picture. It edged down 0.5% compared with the first quarter of 2026, but posted a 1.7% increase compared with the second quarter of the previous year, suggesting continued underlying growth in the sectors outside oil.

Why it matters

The figures reflect the ongoing influence of oil output levels on the Kingdom's headline economic performance, even as diversification efforts continue to build activity in non-oil sectors. For residents and businesses, the year-on-year growth in non-oil activity points to sustained momentum in areas such as services, retail, and construction that shape everyday economic life.

These are preliminary flash estimates and may be revised as more complete data becomes available. Saudi Living will continue to follow updates to the national accounts and their impact on the wider economy.

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