The non-oil GDP growth in Saudi Arabia remains strong in the second quarter, recording a 4.9% increase year-on-year.

Lead indicators such as non-oil PMI remains healthy driven by jobs creation and new orders. Other high frequency data such as cement sales (+4% yoy in September) and the consumer spending (7% yoy)  indicate solid demand trend.

The Saudi preliminary budget for 2025 underscore the expansionary fiscal policy. The kingdom maintains significant fiscal space due to its low debt to GDP ratio.

The oil market outlook is shaped by two key factors: geopolitical tensions and China slow demand.

Geopolitical tension, it stated, was likely to maintain upward pressure on oil prices for the remainder of 2024. “We remain cautiously optimistic and forecast oil prices to be in the range of $75-80/bbl, with upper end subject to prolonged tensions in the region,” it added.