Saudi Arabia's oil export revenues have experienced a decline for the eighth consecutive month, as reported in January 2025. This ongoing decrease is attributed to the voluntary production cuts implemented by the OPEC+ alliance, which is led by the Kingdom itself. According to the General Authority for Statistics, oil revenues fell by 0.4% compared to the same period in 2024, amounting to approximately 70.699 billion Saudi Riyals (18.85 billion dollars) in January 2025, down from 70.998 billion Riyals (18.93 billion dollars) in January 2024.
The report highlights a broader context where total Saudi exports rose by 2.4% year-on-year in January 2025. However, the share of oil exports in total exports decreased from 74.8% in January 2024 to 72.7% in January 2025. This indicates a significant shift in the composition of Saudi exports as the nation grapples with its commitment to production cuts.
In terms of overall export value, Saudi Arabia recorded approximately 97.2 billion Riyals (25.91 billion dollars) in January 2025, an increase from 94.92 billion Riyals (25.30 billion dollars) in the same month of the previous year. Despite the decline in oil revenues, non-oil exports, which include re-exports, surged by 10.7% year-on-year, while non-oil exports excluding re-exports increased by 13.1%.
The General Authority for Statistics also reported that the trade surplus decreased by 11.9% on an annual basis, reflecting increased imports, which rose by 8.3% in January 2025. The rise in imports is attributed to a significant increase in machinery and electrical equipment, which saw a staggering 27.4% increase compared to January 2024.
China has maintained its position as Saudi Arabia's largest trading partner, accounting for 15.2% of total exports and 26.4% of imports. India and Japan ranked second and third in terms of exports, with shares of 10.9% and 10.2%, respectively. The United States and the UAE follow closely in terms of imports.
Despite the challenges faced in the oil sector, Saudi Arabia's non-oil exports have shown robust growth. The Kingdom's exports of chemical products increased by 14.4% in January 2025, while exports of plastics and rubber products rose by 10.5%. This diversification of exports indicates a strategic shift as the Kingdom seeks to reduce its dependency on oil revenues.
Looking ahead, Saudi Arabia's oil export revenues are projected to decrease further, with expectations of total revenues falling to 804 billion Riyals (214.15 billion dollars) in 2025, down from an anticipated 863 billion Riyals (229.87 billion dollars) in 2024. This forecast aligns with the Kingdom's ongoing commitment to OPEC+ production cuts, which have been extended until the end of March 2025.
In 2024, Saudi Arabia's oil revenues had already dropped by 24.1 billion dollars, a decline of 10% compared to the previous year, coinciding with the country’s adherence to voluntary cuts under the OPEC+ agreement. The total revenue from oil exports in 2024 was recorded at 223.3 billion dollars, down from 247.4 billion dollars in 2023.
As part of its strategy to stabilize the oil market, Saudi Arabia has been implementing voluntary cuts since May 2023, initially reducing production by 1.6 million barrels per day and extending this reduction until the end of 2026. In conjunction with other OPEC+ members, the Kingdom has committed to a total reduction of approximately 2 million barrels per day, a policy that has been in effect since November 2022.
Moreover, the Kingdom's oil production in January 2025 was reported at 8.941 million barrels per day, a slight decrease from 8.950 million barrels per day in December 2024. This continued decline in production reflects the ongoing adjustments in response to market conditions and the overarching strategy to balance supply and demand.
In summary, while Saudi Arabia faces challenges in its oil sector, the increase in non-oil exports and a strategic shift towards diversifying its economy may provide a buffer against the volatility of oil prices. As the country navigates these changes, the focus on non-oil sectors could be crucial for long-term economic stability.
