Saudi GDP Down 4.8% Year-on-Year in Q2 2026

Saudi Arabia's real gross domestic product declined 4.8% year-on-year in the second quarter of 2026, driven mainly by a sharp fall in oil-related activity, while the non-oil economy continued to show modest annual growth.

On a seasonally adjusted basis, GDP fell 4.9% compared with the previous quarter. The two figures measure different things: the 4.8% reflects the change against the same quarter a year earlier, while the 4.9% reflects the change from the first quarter of 2026.

Oil activities recorded the steepest drop, falling 24.7% year-on-year and 21.5% quarter-on-quarter. This decline was the main factor pulling down the overall figure during the period.

In contrast, non-oil activities rose 0.6% year-on-year, though they slipped 0.5% from the previous quarter. Government activities grew 0.9% year-on-year and 0.2% quarter-on-quarter, adding steady support to the economy.

Why it matters

For residents and businesses across Riyadh, Jeddah and other cities, the continued growth in non-oil and government activity is a key indicator. It points to the strength of sectors beyond oil — an ongoing priority under the Kingdom's economic diversification agenda. The headline contraction was largely tied to lower oil output, while the wider non-oil economy that shapes everyday jobs, services and spending kept growing on an annual basis.

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