Sharp drop in mining and oil activities drags down overall production index as manufacturing also softens.
ℹ️ Browser-based reading · AI studio voice coming soon
Saudi Arabia's Industrial Production Index (IPI) fell 14.1 percent year-on-year in March 2026, according to data released by the General Authority for Statistics (GASTAT), with declines recorded across the kingdom's key industrial sectors.
Mining and quarrying recorded the steepest drop, falling 22.2 percent compared to March 2025, while oil activities specifically declined by 20 percent over the same period. Manufacturing contracted by 4.7 percent year-on-year, weighed down by an 11.6 percent drop in the manufacture of coke and refined petroleum products and a 4.5 percent decline in chemicals and chemical products.
On a monthly basis, the IPI fell a sharper 22.3 percent from February 2026, with mining and quarrying alone sliding 36 percent and oil activities dropping 30.8 percent.
Not all sectors weakened, however. Electricity, gas, steam, and air conditioning supply grew 10.1 percent year-on-year, water supply and waste management activities edged up 1.1 percent, and basic metals manufacturing posted a 9 percent annual increase. Non-oil activities also rose 1.4 percent on a monthly basis, offering a modest bright spot in an otherwise subdued industrial reading.
Saudi Arabia's Industrial Production Index plummeted 14.1% year-on-year in March, driven by a 20% collapse in oil activities and 22.2% crash in mining and quarrying. Manufacturing also contracted 4.7%, though utilities and basic metals showed modest gains.
The sharp drop in Saudi oil and mining output signals weakening global energy demand, which could affect fuel prices and investment returns for international markets. For workers and businesses tied to Saudi industrial sectors, the contraction suggests slower hiring and reduced activity, while the energy slowdown may ripple through supply chains and energy-dependent industries worldwide.