Overview:

Saudi Arabia's private sector outside oil demonstrated robust momentum in June, posting the strongest expansion in new business activity in four months. Simultaneously, seven member states of OPEC+ agreed to raise crude oil production by 188,000 barrels daily effective August. The dual developments reflect economic diversification efforts alongside energy market coordination, while foreign institutional investors maintained modest positions in domestic equities.

Details:

The non-oil private sector expansion was driven by increased investment volumes, new project launches, and sustained purchasing manager confidence at four-month highs. Private sector credit extended by banks reached 3.2 trillion Saudi riyals by end of May, representing a year-on-year increase of 6.57 percent or 200.33 billion riyals. The tourism and hospitality sector continued its expansion trajectory, with official data projecting 177,000 establishments and one million workers by 2026.

The OPEC+ production adjustment, involving Saudi Arabia, Russia, Iraq, Kuwait, Kazakhstan, Algeria, and Oman, reflects the group's commitment to market stabilization amid volatile global energy conditions. The increase follows previous output adjustments and signals cautious optimism regarding demand recovery. Separately, the Saudi Arabia Capital Market Authority disclosed plans to establish a commodities and metals trading venue during the coming period, with three-year fee exemptions to encourage participation.

Private sector financing activity remained robust, with the Aramco Taheel digital financing platform supporting small and medium enterprise growth. Real estate regulations evolved with new frameworks governing non-Saudi property ownership, including standardized fees, dedicated electronic portals, and designated banking arrangements.

Outlook:

Investors are monitoring the sustainability of private sector momentum against external regional pressures and global economic uncertainty. The implementation of expanded oil production in August will provide market signals regarding demand strength and price stability expectations for the remainder of 2026.