Energy
Wednesday, January 31st, 2024 4:35 pm EDT
Key Points
- Fourth-Quarter GDP Decline: Saudi Arabia’s real GDP for the fourth quarter experienced a 3.7% year-on-year contraction, as reported by flash estimates from the General Authority for Statistics. This decline, while still negative, represents a smaller drop compared to the 4.4% year-on-year slide observed in the third quarter.
- Impact of Oil Activities: The decline in GDP was largely attributed to a significant 16.4% contraction in oil-related activities. In contrast, non-oil activities and government activities demonstrated growth, expanding by 4.3% and 3.1%, respectively, year-on-year.
- Annual Economic Contraction: The full-year economic performance for Saudi Arabia reveals a 0.9% contraction, based on government data. This annual shrinkage reflects the challenges faced by the country’s economy throughout the year.
- Oil Sector Dominance: Saudi Arabia’s economy heavily relies on its petroleum sector, constituting 42% of its GDP. The impact of the contraction is notable as the country has been implementing output cuts throughout the year to boost oil prices. Additionally, Saudi Arabia has borne the majority of voluntary crude production cuts agreed upon by select members of the Organization of the Petroleum Exporting Countries (OPEC) and its allies.
In the fourth quarter of the year, Saudi Arabia’s real GDP experienced a year-on-year contraction of 3.7%, according to preliminary estimates released by the General Authority for Statistics. While this decline marks a contraction, it is a smaller drop compared to the 4.4% year-on-year slide witnessed in the third quarter. The primary contributor to this decline was a 16.4% reduction in oil-related activities. In contrast, non-oil activities saw expansion by 4.3%, and government activities grew by 3.1% year-on-year. Over the entire year, Saudi Arabia’s economy contracted by 0.9%, as reported by government data. The contraction comes as the world’s largest crude exporter implemented output cuts throughout the year in an effort to bolster oil prices. Saudi Arabia also took on the majority of additional voluntary crude production cuts agreed upon by some members of the Organization of the Petroleum Exporting Countries (OPEC) and its allies. It’s worth noting that the kingdom’s economy is highly dependent on its petroleum sector, which constitutes 42% of its GDP, emphasizing the significance of developments in the oil industry to the overall economic performance of the country.
For the full original article on CNBC, please click here: https://www.cnbc.com/2024/01/31/saudi-arabia-fourth-quarter-gdp.html
