Raw Materials in Saudi Arabia are among the most important natural resource assets that support the Kingdom’s economy. These primary materials, whether renewable or non-renewable, form the basis of major industries and are integrated into domestic production processes or exported globally.
Around 70% of Saudi Arabia’s raw material exports are linked to petroleum derivatives, while plastics and chemical products account for nearly 60% of the Kingdom’s non-oil exports. Given their importance, raw material prices have a direct impact on the global economy, particularly during crises such as the COVID-19 pandemic, when production declines and increased transportation costs drove prices sharply upward.
Crude Oil Production
The most significant raw material in Saudi Arabia remains crude oil, managed by Saudi Aramco. The Kingdom began commercial production in 1938, with the first oil shipment exported in 1939 via the tanker D.G. Scofield.
Today, Saudi Aramco maintains substantial proven reserves and production capacity. It supplies energy markets worldwide with five types of crude oil:
- Arab Heavy
- Arab Medium
- Arab Light
- Arab Extra Light
- Arab Super Light
These hydrocarbons remain the backbone of Saudi Arabia’s economy and a cornerstone of global energy markets.
Mineral Resources
Alongside hydrocarbons, mineral resources have become an essential growth driver. Saudi Arabia’s Eighth Development Plan focused on expanding mineral extraction, raising raw material exploitation from 237 million tonnes (2003–2004) to 325 million tonnes (2007–2008), with an average growth rate of 8.2%.
In January 2024, the Kingdom estimated its mineral wealth at SAR9.4 trillion (USD2.5 trillion), up from SAR5 trillion in 2016. By 2022, extraction volumes exceeded 591,872 thousand tonnes, highlighting the scale of operations.
The Deputy Ministry for Mineral Resources under the Ministry of Industry and Mineral Resources oversees exploration, licensing, and investment promotion. By May 2024, Saudi Arabia had issued 2,294 valid mining licenses, covering minerals such as silica sand, gypsum, salt, limestone, clay, dolomite, feldspar, barite, marble, sandstone, and precious metals.
Exploration has revealed more than 5,300 mineral sites, including gold, silver, copper, zinc, iron, and rare elements concentrated in the Arabian Shield region.
Contribution to the Economy
Mining and quarrying, including oil and gas, contributed 37.8% of GDP at constant prices in 2022, compared to 35.5% in 2021. This sector recorded 16% growth in 2022, reversing a 1.1% decline the previous year.
Saudi Arabia’s strategy divides the sector into three phases:
- Exploration and Mining – Surveying, feasibility studies, mine development, and raw material processing.
- Intermediate Industries – Refining and smelting to produce basic materials such as aluminum alloys and steel billets.
- Manufacturing Industries – Production of semi-finished and finished goods like iron sheets, pipes, and rods.
Initiatives such as the Rapid Exploration Programs and the Saudi Mining Services Company have been launched to boost exploration, enforce compliance, and improve environmental, health, and safety standards.
Raw Material Exports
In 2022, Saudi Arabia’s exports of basic metal products and processed metals reached SAR27.8 billion, a 30.4% increase from 2021. Major export markets included:
- India (SAR4.14 billion)
- United Arab Emirates (SAR3.04 billion)
- United States (SAR2.52 billion)
These figures reflect the Kingdom’s growing role in supplying industrial inputs to global economies.
Regulations and Incentives
Saudi Arabia’s approach to raw materials is governed by long-standing regulations and modern frameworks:
- The Law of Protection and Encouragement of National Industries (1961) exempts raw materials and semi-manufactured products from customs duties when no local alternatives exist.
- The Saudi Export-Import Bank regulation (2020) enables financing of raw material imports to create added value and support re-exports.
Vision 2030 and Investment Opportunities
Under Saudi Vision 2030, raw materials have become central to diversification and economic transformation. Initiatives include:
- Expanding logistics and export hubs, such as King Fahd Industrial Port in Jubail (established in 1982).
- Empowering local and foreign investors with incentives for mining and mineral exploration.
- Promoting private sector participation to create competitive industries based on Saudi raw materials.
By leveraging hydrocarbons, minerals, and industrial raw materials, Saudi Arabia aims to build a globally competitive resource-based economy, attracting investment and supporting downstream manufacturing.
