IMF: Saudi economy shows resilience despite ongoing Iran war and Hormuz closure

What happened

The New Arab reports that the International Monetary Fund has declared the Saudi economy resilient despite the adverse impacts of the war in the Middle East and the closure of the Strait of Hormuz by Iran. The IMF highlights the kingdom’s strong fundamentals and diversified oil and logistics infrastructure, which have helped mitigate the economic shocks caused by regional hostilities.

According to the IMF, the disruption from the conflict has curtailed Saudi oil exports and weighed on non-oil economic activity and business confidence. However, Saudi Arabia has managed to re-route crude oil via its extensive East-West pipeline to export terminals on the Red Sea coast, partially offsetting the impact of the Strait of Hormuz closure. The oil company Saudi Aramco’s net profits rose 25.5 percent year-on-year, supported by high crude prices.

The kingdom’s strategic efforts to develop new trade corridors, including road and rail links, aim to enhance goods transportation across the Gulf and circumvent the maritime blockade affecting regional commerce. The IMF report notes Saudi Arabia entered 2026 with favorable economic momentum, citing a 4.5 percent GDP expansion in 2025, driven by the end of OPEC+ production cuts and strong non-oil sector growth.

Known from the source

• IMF reports Saudi Arabia’s economy remains resilient despite the Middle East war and closure of the Strait of Hormuz.
• Saudi Arabia has diversified oil export infrastructure, including the East-West pipeline terminating at Red Sea ports.
• Saudi Aramco reported a 25.5% net profit increase year-on-year due to rising crude prices.
• Saudi Arabia has expanded trade corridors connecting road and rail links across the Gulf to mitigate blockade effects.
• Saudi GDP grew 4.5% in 2025, supported by the end of OPEC+ cuts and non-oil sector strength.

What remains unclear

Saudi Arabia also benefits from substantial fiscal buffers, including low government debt levels, large foreign reserves, and a sovereign wealth fund, which provide resilience against external shocks related to the ongoing regional conflict involving Iran. These factors underpin the kingdom’s capacity to maintain economic stability amid heightened geopolitical risks.

What remains unclear: Any new developments on Iran’s Strait of Hormuz closure or related maritime incidents since the IMF report. Further updates on the impact of the war on non-oil economic activity and confidence in Saudi Arabia. Verification of current Saudi export volumes versus IMF estimates given ongoing conflict. Ensure the phrasing around the closure of the Strait of Hormuz and war impacts remains precise and attributed to the IMF.

Evidence note

Outside Brief has treated the source material as confirmed within the supplied source context, while retaining attribution to the original publisher.

Original source: The New Arab. Open the source.