RIYADH: Saudi Arabia’s electricity and gas supply activities surged by 38.6 percent in November compared to the same period the previous year, official data revealed.
However, the Kingdom’s overall Industrial Production Index decreased by 1.8 percent in November compared to the same month in 2022, according to the General Authority for Statistics.
The drop in IPI was driven by Saudi Arabia’s decision to reduce oil output, aligning with the agreement made by the Organization of Petroleum Producing Countries and its allies, known as OPEC+.
GASTAT noted that the fall in the index was mainly due to a significant drop in mining and quarrying activities, a decision taken by the Kingdom to maintain oil market stability.
The report indicated that mining and quarrying activities experienced an annual decline of 15.8 percent in November, corresponding to the country’s decision to decrease oil production to 8.8 million barrels per day.
“The index peaked in early 2022, supported by growth rates of mining and quarrying activities, and manufacturing activities during that year. Since then, and in particular, in 2023, growth rates went down, mainly driven by mining and quarrying,” stated the GASTAT report.
Furthermore, the report indicated that the relative weights of the mining and quarrying, manufacturing, and electricity and gas supply sectors in the IPI were 74.5 percent, 22.6 percent and 2.9 percent, respectively.
Consequently, it stated that the trend of the IPI in the mining and quarrying sector dominated the general index.
In April, Saudi Arabia decided to reduce oil output by 500,000 bpd, which is now extended until the end of December 2024.
The Kingdom also pledged an additional oil output cut of 1 million bpd in July, which continued until the end of December 2023.
The IPI, an economic indicator, reflects the relative changes in the volume of industrial output, and it is calculated based on the industrial production survey.
According to GASTAT, manufacturing activity decreased by 3.3 percent in November, compared to the same month of the previous year.
On a monthly basis, Saudi Arabia’s IPI decreased by 1.8 percent in November compared to the previous month.
The report added that the Kingdom’s mining and quarrying sector decreased by 1.4 percent month on month in November, while manufacturing and electricity and gas supply activities dipped by 1 percent and 14 percent, respectively, during the same period.
