Saudi GDP growth slows to 2.8% in first quarter as Iran war weighs on economy
Saudi Arabia's GDP growth slowed to 2.8% year-on-year in the first quarter of 2026, down from 3.7% a year earlier, as regional conflict involving Iran disrupted energy infrastructure and trade routes. Non-oil sector growth also decelerated significantly, while oil activity declined on a quarterly basis due to reduced production. The International Monetary Fund revised its 2026 growth forecast for Saudi Arabia downward amid broader regional economic uncertainty.
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ABU DHABI, April 30 - Saudi Arabia’s real gross domestic product grew 2.8% in the first quarter, year-on-year, preliminary government estimates showed on Thursday, slowing from 3.7% a year ago, as the economic fallout of the U.S.-Israeli war on Iran on the world’s top oil exporter becomes clear. Tehran’s attacks on Gulf states, in response to U.S.-Israeli strikes that began in late February, have damaged major energy facilities and disrupted shipping through the Strait of Hormuz, which would normally handle about 20% of global oil and liquefied natural gas flows. As a result, economic growth in the Gulf is expected to sharply slow this year, analysts say, with several economies forecast to contract this year, before rebounding in 2027.
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