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 Iranian-backed Yemeni group has ramped up its attacks on Saudi Arabia in recent weeks, hitting oil facilities and airports among other targets, as Yemen’s dormant civil war has roared back into life.
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 US-Israeli war with Iran that began in February.
In its regional report released on Thursday, 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.
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