Finally, an upgrade: The International Monetary Fund (IMF) raised its forecast for Saudi Arabia’s GDP growth in 2025 to 3.6%, up 0.6 percentage points from its April projection, the fund said in its World Economic Outlook report (pdf). Growth for 2026 is also expected to rise to 3.9%, revised upwards by 0.2 percentage points.

Region-wide rebound: The MENA region is now expected to grow 3.2% in 2025, up 0.6 percentage points from April forecast. The 2026 outlook remained unchanged at 3.4% in 2026.

Oil prices to drop, but not as sharply as feared: The fund now expects oil prices to fall by 13.9% in 2025 to an average of USD 68.18 / bbl — a more moderate drop than previously anticipated. The decline is set to continue in 2026, though at a slower pace, with prices forecast to fall 5.7% to USD 64.33 per barrel.

REMEMBER- GDP grew 1.3% y-o-y in 2024, exceeding the government’s 0.8% forecast, while 4Q growth hit 4.5% y-o-y GDP, the fastest in two years, supported by oil and non-oil activity. The Finance Ministry expected GDP growth of 4.6% in 2025, 3.5% in 2026, and 4.7% in 2027, fueled by non-oil expansion, job creation, and foreign investment.

Still, challenges lie ahead: Trade policy uncertainty, continued geopolitical tensions, and potential disruptions in energy markets could dampen the outlook. While global financial conditions have eased and oil prices have stabilized for now, any escalation in tariffs or regional conflicts could quickly shift sentiment, the report said.

** We’ve got a rundown of the outlook on the global economy in today’s Planet Finance, below.

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