Saudi Arabia’s non-oil activities expanded by 1.9% year-on-year in the third quarter of 2026, providing support to the economy as a steep decline in oil activity pushed overall real gross domestic product down 3.8%.
The preliminary estimates from the General Authority for Statistics, reported by Saudi Gazette, showed oil activities contracting by 20.4% compared with the same quarter of 2025. Government activities declined by 2.7%.
Despite the annual downturn, the economy improved from the previous quarter. Seasonally adjusted real GDP increased by 1.3% compared with Q2 2026, supported by growth in both oil and non-oil activities. saudigazette.com.sa
Saudi Arabia’s Q3 2026 GDP figures
The annual and quarterly comparisons show different aspects of the Kingdom’s economic performance.
| Economic indicator | Annual change: Q3 2026 versus Q3 2025 | Quarterly change: Q3 versus Q2 2026* |
|---|---|---|
| Real GDP | −3.8% | +1.3% |
| Oil activities | −20.4% | +5.7% |
| Non-oil activities | +1.9% | +0.6% |
| Government activities | −2.7% | −1.2% |
Quarterly figures are seasonally adjusted. All figures are preliminary.
Oil was the largest source of weakness in the annual comparison but the main driver of the quarterly improvement. Non-oil activities expanded on both measures, while government activities declined.
Non-oil growth cushions the annual decline
Non-oil activities added 1.1 percentage points to Saudi Arabia’s annual GDP growth rate in the third quarter. Net taxes on products contributed a further 0.1 percentage points.
Those positive contributions partially offset the weakness elsewhere in the economy.
Oil activities subtracted 4.7 percentage points from annual growth, while government activities reduced it by another 0.4 percentage points.
The figures demonstrate the distinction between a sector’s growth rate and its contribution to the overall economy. Non-oil activity grew by 1.9%, but its contribution to total GDP growth was 1.1 percentage points because the aggregate calculation reflects its weight in the economy.
Continued non-oil expansion helped limit the downturn, although it was insufficient to counter the scale of the oil-sector contraction.
Oil activities rebound from the previous quarter
On a seasonally adjusted basis, oil activities increased by 5.7% compared with Q2 2026, contributing one percentage point to quarterly GDP growth.
Non-oil activities rose by 0.6%, adding 0.4 percentage points. Net taxes on products contributed another 0.2 percentage points.
Government activities moved in the opposite direction, falling 1.2% and subtracting 0.2 percentage points from quarterly growth.
The contribution figures are rounded and may not add precisely to the published headline growth rate.
The quarterly results suggest an improvement in activity during the July-to-September period. However, the large annual decline in oil activities shows that output remained substantially below its level a year earlier.
Why GDP can rise quarterly while falling annually
Saudi Arabia’s annual contraction and quarterly expansion are compatible because they use different comparison periods.
The 3.8% annual decline compares economic output in Q3 2026 with output in Q3 2025. The 1.3% quarterly increase compares Q3 2026 with the immediately preceding quarter, after seasonal adjustment.
An economy can recover from a weaker quarter while remaining below the level recorded a year earlier. That is the pattern shown in these preliminary figures.
Seasonal adjustment helps remove recurring calendar-related fluctuations, making consecutive quarters more useful for assessing changes in economic momentum.
Neither comparison should replace the other. Together, they show an economy that improved from Q2 but had not returned to its year-earlier level of output.
What the figures say about Saudi economic diversification
The non-oil expansion shows that activity outside the oil and separately reported government categories continued to support growth during a difficult quarter.
At the same time, oil’s substantial negative contribution demonstrates its continuing influence on Saudi Arabia’s headline economic performance.
The figures therefore present a mixed picture: non-oil activities provided resilience, while the overall economy remained sensitive to changes in oil activity.
The summary estimates do not identify which individual non-oil industries drove the increase. They also do not establish the causes of the contraction in oil activities or the decline in government activities. A more detailed sector breakdown will be needed to assess those developments.
GASTAT estimates remain preliminary
GASTAT’s flash GDP estimates provide an early assessment shortly after the end of a quarter, before complete quarterly information becomes available.
The figures may consequently be revised as additional data are incorporated.
For now, the central findings are clear: Saudi non-oil activities grew on both annual and quarterly measures, oil activity recovered from the previous quarter but remained sharply lower year-on-year, and overall GDP recorded a quarterly improvement despite an annual contraction.
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