RIYADH: Saudi Arabia’s real gross domestic product (GDP) contracted by 4.4% in the third quarter, government data showed on Thursday, as oil activity plummeted 17% compared with a year earlier following crude output cuts under OPEC+ agreements.

The kingdom has extended a voluntary production cut of 1 million barrels per day until the end of the year which it says is a preemptive move to stabilise the market.

Despite the sharp contraction, the government still expects 2023 GDP growth to come in at 0.03%, according to the 2024 budget released on Wednesday. Growth for 2024 is seen at 4.4%, the budget statement said.

The General Authority for Statistics said Q3 non-oil activity increased by 3.5% year-on-year with government activities growing by 1.9%.

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Earlier official estimates had indicated Q3 GDP would shrink 4.5%.

Saudi Arabia’s economic growth surged last year amid a huge windfall from high oil prices which averaged about $100 per barrel, resulting in the highest GDP growth among G20 nations and the country’s first budget surplus in almost a decade.