Impact of Houthi attacks on Saudi economy 'limited' for now: IMF

DUBAI

This handout satellite image released by Vantor shows a pumping station along Saudi Arabia’s East-West pipeline (Petroline) in al-Mesabaah, southeast of Medina, on Sept. 13, 2026, after an attack and fires caused significant damage to the site on Sept. 11. (AFP File Photo)

Houthi attacks on Saudi Arabia are having only a "limited" economic impact on the kingdom so far, owing to robust domestic demand, the IMF's regional director told AFP, though geopolitical uncertainty remains a threat.

The world's largest oil exporter, Saudi Arabia has had its crude shipments squeezed by Iran's blockade of the Strait of Hormuz and the Houthis' declaration of a maritime blockade.

But shipments continue to move despite the conflicts, Jihad Azour told AFP.

The Gulf kingdom also has "strong internal demand and a robust public sector, so the impact is limited, "he said of the Houthi attacks.

Nevertheless, the economy is expected to contract by 3.3 percent this year, owing to the impacts of the U.S.-Israeli war with Iran.

In its regional report released on Oct. 22, the IMF said that every Gulf state bar Oman had suffered reductions in its hydrocarbon production.

The economy of the region as a whole is expected to shrink 4.8 percent in 2026.

Still, the IMF expects a strong rebound of around 9.1 percent growth next year, albeit with deep uncertainty amid the ongoing geopolitical tensions and stalled diplomacy between Washington and Tehran.