RIYADH: Saudi Arabia’s non-oil activities grew 1.9 percent year on year in the third quarter of 2026, accelerating from 0.8 percent in the previous three months, according to official flash estimates.   The expansion helped cushion the wider economy’s decline. Real gross domestic product fell 3.8 percent from the same period last year, after a 4.7 percent contraction in the second quarter, the General Authority for Statistics reported.  The latest figures highlight the contrasting pressures on the Kingdom’s economy, with a sharp contraction in oil activities weighing on overall growth while non-oil sectors continued to expand. The figures come amid wider regional economic disruption following US and Israeli strikes on Iran on Feb. 28, which triggered a regional conflict and disrupted shipping through the Strait of Hormuz, a vital corridor for global oil and gas supplies.  Oil activities declined 20.4 percent annually, compared with a 24.8 percent fall in the preceding quarter. Government activities contracted 2.7 percent, reversing the second quarter’s 0.9 percent growth.  “Oil activities contributed negatively to real GDP growth by 4.7 percentage points,” GASTAT said in the report.  Non-oil activities added 1.1 percentage points to annual GDP growth, while net taxes on products contributed 0.1 percentage points. Government activities subtracted 0.4 percentage points.  Quarterly recovery  On a seasonally adjusted basis, the economy expanded 1.3 percent from the second quarter, reversing a 4.8 percent quarterly contraction.  Oil activities increased 5.7 percent quarter on quarter, while non-oil activities rose 0.6 percent after declining 0.4 percent in the preceding three months. Government activities fell 1.2 percent.  The figures show that output recovered from the second quarter but remained below its level a year earlier. Seasonal adjustments remove recurring calendar effects, including those associated with holidays, allowing comparisons between consecutive quarters.  Separate business indicators also pointed to improving non-oil conditions toward the end of the quarter.    Saudi Arabia’s Purchasing Managers’ Index rose to 55.3 in September from 53.8 in August, according to the government’s DataSaudi platform. The index measures activity in the non-oil private sector, with readings above 50 indicating an improvement in business conditions from the previous month.  Economic outlook  The figures follow the IMF’s October World Economic Outlook, which forecasts Saudi Arabia’s economy will contract by 3.3 percent in 2026 before rebounding to 7.9 percent growth in 2027.  The fund linked its regional outlook to prolonged disruption through the Strait of Hormuz and an anticipated recovery as production, exports and logistics normalize.    The Kingdom is projected to be less affected than several neighboring energy producers because of its more diversified export routes.  Bahrain, Iraq, Kuwait and Qatar are projected to experience double-digit economic contractions this year, followed by double-digit expansions in 2027, according to the IMF.  GASTAT’s flash estimates are preliminary, compiled shortly after the quarter ends while some underlying data remain incomplete. Its classification separates non-oil activities from both oil production and refining, and government services.