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Saudi economy suffers biggest contraction since pandemic as Iran war hits oil exports

thenationalnews.com · 12dShare

Saudi Arabia’s economy has recorded its biggest quarterly contraction since the Covid-19 pandemic as the US-Iran war weighs heavily on the oil sector. The country’s gross domestic product shrank by 4.8 per cent on an annual basis during the three months to the end of June, the General Authority for Statistics said on Thursday. The contraction is in sharp contrast to the 3 per cent growth recorded in the first three months of 2026 by the Arab world’s largest economy. A 24.7 per cent plunge in oil activity drove the April-June quarter economic contraction. The hydrocarbons sector's contribution to Saudi GDP grew 2.9 per cent on an annual basis during the first quarter of this year, the preliminary Gastat estimate showed. Non-oil activity expanded only by 0.6 per cent during the second quarter, compared with a 2.9 per cent expansion in the previous quarter. The quarterly contraction is the most pronounced since the second quarter of 2020, when the Saudi economy shrank 7 per cent at the he

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