Record contraction of 4.8% and oil plunge of 24.7%… “Financial Times” reveals the deepest economic crisis hitting Saudi Arabia

Follow-ups – Al-Khabar Al-Yemeni:

In a stark indicator of the scale of the predicament shaking Riyadh’s economic structure, the “Financial Times” revealed that the Saudi economy has contracted by a notable 4.8% in the second quarter of this year compared to the same period last year, recording the sharpest quarterly decline the Saudi economy has witnessed since the COVID-19 pandemic.

Economic data showed that this sharp contraction was primarily driven by the massive decline in the oil sector, which plunged by 24.7%, a realistic and direct translation of the repercussions of the closure of the Strait of Hormuz and the Yemeni naval blockade imposed by Sana’a forces on Saudi navigation.

This quarterly collapse confirms with official figures the scale of the heavy losses being incurred by Riyadh. The 24.7% contraction in the oil sector integrates with a series of accumulated crises revealed by previous international reports, including the denial of war risk insurance coverage for all Saudi-linked ships according to “Reuters,” an increase in shipment costs by about $20 million due to rerouting around Africa, in addition to demands by Indian refineries to reduce the price of “Sidi Kerir” oil by $10 per barrel to compensate for the disrupted pipeline route and its inability to accommodate the required quantities.