Saudi Arabia reported its fastest economic growth rate in a decade Sunday, as a booming oil sector fuelled a 9.6 per cent rise in the first quarter over the same period of 2021.
The preliminary results come after the world’s biggest oil exporter resisted US entreaties to raise output in an attempt to rein in prices that have spiked since the Ukraine war began.
“Oil activities led the real Gross Domestic Product (GDP) of Saudi Arabia to achieve the highest growth rate in [the] last 10 years,” the Saudi statistics authority said in initial estimates published online.
Growth in the oil sector reached 20.4 per cent year-on-year in the first quarter, while the non-oil sector expanded 3.7 per cent year-on-year, it said.
The agency noted that data for the quarter was “still incomplete” and could be revised.
The Ukraine war and the resulting rise in crude prices has been a boon to oil-producing states like Saudi Arabia, whose GDP is expected to grow by 7.6 per cent in 2022, the International Monetary Fund said last week.
As the war in Ukraine got underway, Saudi Arabia and the United Arab Emirates stressed their commitment to the OPEC+ oil alliance, which Riyadh and Moscow lead, underscoring Riyadh’s and Abu Dhabi’s increasing independence from long-standing ally Washington.
Last month, ratings agency Fitch predicted that the kingdom would record a budget surplus in 2022 for the first time since 2013.
But Fitch noted that, despite efforts to diversify the economy, Saudi Arabia’s oil dependence “remains high”, accounting for more than 60 per cent of total budget revenues.