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The Kingdom’s real GDP grew 4.8% y-o-y in 3Q 2025, driven by a solid recovery in the oil sector, offsetting a softening expansion in the non-oil GDP, according to fresh data (pdf) from the General Authority for Statistics (Gastat). The fresh reading is down by 0.2 percentage points from the flash estimates made by Gastat in November. On a quarterly basis, the Kingdom’s seasonally adjusted real GDP growth came in at 1.4%, matching the preliminary estimate.
Driving growth: The oil sector had an 8.3% y-o-y growth in 3Q, up by 0.1 percentage point from the flash estimates. Oil activities contributed 2.0 percentage points to the Kingdom’s overall growth. This uptick in oil GDP mirrors higher production levels as the Kingdom gradually unwinds its oil production cuts under Opec+.
MEANWHILE- Non-oil activities grew 4.3% y-o-y during the quarter, contributing the bulk (2.4 percentage points) of the Kingdom’s headline expansion, while government activities saw 1.4% y-o-y growth.
Standout sectors: Petroleum refining activities logged the highest growth during the quarter, up 11.9% y-o-y, followed by crude petroleum and natural gas activities, at 7.3% y-o-y. Electricity, gas, and water activities came in third place with 6.4% growth y-o-y
On a quarterly basis, the oil sector posted the highest increase, up 3.3%, while government activities grew 1.1%, and the non-oil economy edged up 0.6% q-o-q. While the non-oil sector was the largest contributor to our GDP growth in 3Q on an annual basis, rising oil output is masking a slowdown in non-oil growth, “which is likely to persist against the backdrop of fiscal consolidation,” Capital Economics’ James Swanston wrote in a research note seen by EnterpriseAM last month.
Forecasting for the year: Capital Economics sees the Saudi economy expanding by close to 5% this year, before softening to 4.3% in 2026, “as the non-oil slowdown continues amid fiscal tightening and the support from oil output increases fades,” Swanston said. Meanwhile, Arqaam Investment sees the Kingdom’s full-year growth approaching 4.5%, with the current trend continuing through 4Q, Head of Specialized Research Ahmed Ramzy said.
ICYMI- The World Bank has recently upgraded the Kingdom’s 2025 growth forecast to 3.8%, marking a 0.5% increase from the bank’s previous forecast in October.
