The International Monetary Fund (IMF) has lowered Saudi Arabia’s growth outlook in its latest report. In its recent World Economic Outlook (WEO) update, the IMF lowered the Kingdom’s growth rate from 3.3% to 3%. The decline in GDP growth comes after the global markets are experiencing major disruptions in overall oil production.
Also Read: US Dollar Weakness Is Here to Stay: Analyst
Saudi Arabia’s Growth Outlook Lowered By IMF
Financial analysts at the IMF also wrote that trade wars, tariffs, and conflicts are eating into Saudi Arabia’s revenues. Not just for 2025, the IMF also reduced the Kingdom’s growth outlook for 2026 by 0.4%. The growth rate for 2026 now stands at 3.7% from the previous projected number.
Also Read: SEC Drops Lawsuit Against Richard Heart: HEX Rallies 78%
“The Middle East and Central Asia is projected to come out of several years of subdued growth, with the rate accelerating from an estimated 2.4 percent in 2024 to 3.0 percent in 2025 and to 3.5 percent in 2026 as the effects of disruptions to oil production and shipping dissipate and the impact of ongoing conflicts lessens,” the IMF’s economists wrote in the April outlook on Saudi Arabia.
The report stated that conflicts are a cause of concern as oil prices are projected to dip. Crude oil has already fallen to a low of $64 and is projected to dip below the $60 mark. “Compared with that in January, the projection is revised downward, reflecting a more gradual resumption of oil production, persistent spillovers from conflicts, and slower-than-expected progress on structural reforms,” said the IMF in Saudi Arabia.
Also Read: De-Dollarization Surge: Why Europe’s Euro Bonds Could End U.S. Dollar’s Reign
The latest report also sheds light on an upcoming decline in commodity prices due to lower oil production. “These risks may be amplified for commodity exporters amid a continued decline in commodity prices, particularly those for oil and copper, which typically serve as indicators of an impending recession by signaling a slowdown in industrial activity in importers, such as China,” wrote the IMF on Saudi Arabia.