The electricity and gas supply sector in Saudi Arabia experienced a notable growth of 21.5% in August compared to the same period last year, as reported by the General Authority of Statistics
This sector has consistently demonstrated substantial annual expansion since the beginning of 2023. This growth can be attributed to the Kingdom’s strategic investments in energy infrastructure, encompassing the construction of power generation facilities, gas plants, and electricity distribution networks to meet the escalating demand.
Furthermore, Saudi Arabia has proactively implemented energy-efficient practices aimed at curbing waste and promoting responsible energy consumption, thereby enhancing the efficiency of the electricity and gas sectors.
Recent data also indicates a 4.6% annual growth in manufacturing activity within the Kingdom for the month of August.
However, the reduction in Saudi Arabia’s oil production to 8.85 million barrels per day in August resulted in an annual decrease of 19.3% in mining and quarrying activity.
During the policy meeting in June, the Organization of the Petroleum Exporting Countries (OPEC) and its allies, collectively known as OPEC+, reached an agreement to limit supply until 2024. In adherence to this, Saudi Arabia committed to a voluntary production cut for July, which was subsequently extended until August.
In September, the Kingdom announced a further extension of its voluntary oil production cut of 1 million barrels per day until the end of the year.
The GASTAT report released on Monday highlighted that, despite an increase in the manufacturing, electricity, and gas supply sectors, the overall industrial production index experienced a 12% decline. This is primarily due to the substantial weights of the mining and quarrying, manufacturing, and electricity and gas supply sectors in the IPI, which stand at 74.5%, 22.6%, and 2.9%, respectively.
GASTAT noted in its report released on Tuesday that the trend in the mining and quarrying sector significantly influences the general IPI.
Additionally, manufacturing activity remained steady when compared to July, while there was a notable 11% surge in electricity and gas supplies compared to the previous month. However, the mining and quarrying sector saw a slight decline of 1.1%, resulting in an overall decrease of 0.3% in the IPI compared to July.
The Industrial Production Index (IPI) serves as an economic gauge indicating relative shifts in industrial output volume. Its computation relies on data sourced from an industrial production survey.