S. Arabia’s economy shrinks in Q4 ’23

Saudi Arabia’s economy shrank in the fourth quarter after it extended oil output cut in an effort to raise prices, as per a Bloomberg report.

Following a 4.4 per cent decline in the previous quarter, the gross domestic product contracted to 3.7 per cent year on year, according to preliminary data released by the kingdom’s statistics agency on Wednesday. Overall in 2023, the GDP decreased by 0.9 per cent.

Oil activities dropped by 16 per cent in the fourth quarter, indicating that the energy industry is the only one affected by the downturn that began with output reductions. On the other hand, non-oil activities which is responsible for creating jobs, grew by 4.3 per cent.

According to The International Monetary Fund (IMF) estimates, Saudi Arabia’s economy shrank by 1.1 per cent last year as a result of its prolonged production cut, which left it pumping 9 million barrels per day (bpd)—the lowest level in several years.