(Bloomberg) – Saudi Arabia’s economy expanded at the fastest pace in three years in 2025, with the oil sector emerging as a stronger engine of growth under new OPEC+ supply policy.
Gross domestic product rose 4.5% in the 12 months through December, according to preliminary data published by the statistics office on Sunday. The expansion was the strongest since 2022, as was the 5.6% growth rate seen for the oil economy.
Non-oil activities slowed for a third straight year, though the sector was still the biggest contributor to overall economic expansion in 2025. Real GDP for the whole economy grew 4.9% year on year in the final quarter of the year.
State oil giant Saudi Aramco has been pumping more crude since around mid-2025 as part of supply increases agreed to by OPEC+, led by the kingdom and Russia. The Gulf nation churned out about 10 MMbpd in the final three months of last year, the most since early 2023, according to data compiled by Bloomberg.
While Saudi officials say oil activities are less important than in the past given their focus on growing other areas, the oil sector still makes up about half of the economy.
See also: Brent crude rallies above $71 on renewed U.S.-Iran tensions
Sunday’s GDP data underscores that Saudi Arabia’s economic activity remains a bright spot for a government that’s currently adjusting its strategy to spend more efficiently and contend with fresh volatility for both oil prices and geopolitics.
Benchmark Brent crude topped $70 a barrel last week for the first time in months as geopolitical tensions between Iran, Israel and the U.S. flared.
While any sustained increase in prices would boost Saudi oil revenues, a renewed conflict risks slowing growth in the country’s broader economy. Saudi Arabia’s main stock exchange dropped the most since April on Sunday, in a sign of the investor angst.
For now, economic momentum is seen continuing. The International Monetary Fund last month upgraded its 2026 economic growth forecast for the kingdom to 4.5% from 4%, citing the benefits of higher oil production and a healthy non-oil sector.
