RIYADH: Saudi Arabia’s Industrial Production Index edged up 1 percent in February, compared to the previous month, driven by a rise in manufacturing activities.
According to the General Authority for Statistics, the Kingdom’s sub-index of manufacturing activity indicated a 1.2 percent month-on-month increase in the second month of the year.
The uptick in manufacturing activities was supported by a rise in the production of coke and refined petroleum products, which increased by 0.4 percent.
The sub-index for mining and quarrying activity marginally increased by 0.6 percent month-on-month in February.
Similarly, electricity, gas, steam, and air conditioning supply increased by 7.6 percent during the same period compared to January.
The report revealed that the sub-index for water supply, sewerage, waste management, and remediation activities also rose by 2.1 percent month-on-month in February.
According to GASTAT, IPI is an economic indicator reflecting relative changes in the volume of industrial output, calculated based on the production survey.
However, Saudi Arabia’s IPI decreased by 7.7 percent in February compared to the same month of the previous year, driven by a drop in mining and quarrying activity.
GASTAT revealed that the sub-index for mining and quarrying activity decreased by 13.8 percent in February compared to the same month in 2023, as Saudi Arabia reduced its oil production to 9 million barrels per day.
“Given the relative weights of the mining and quarrying activity which reached 61.4 percent, the trend of the industrial production in the mining and quarrying sector dominates the trend in the general IPI,” stated the authority in the report.
The decline in mining and quarrying activities was a result of the Kingdom’s decision to decrease crude output, in alignment with an agreement by the Organization of the Petroleum Exporting Countries and its allies, known as OPEC+.
In April 2023, Saudi Arabia decided to reduce oil output by 500,000 bpd, which is now extended until the end of December 2024.
On a positive note, manufacturing activities in the Kingdom rose by 2.1 percent in February compared to the same period of the previous year, driven by an increase in the production of non-metallic products.
Similarly, electricity, gas, steam, and air conditioning activities, along with the sub-index for water supply, sewerage, waste management, and remediation, recorded an annual increase of 7.7 percent and 8.5 percent, respectively. However, due to the low weight of these activities, they did not have a significant impact on the index.
Source: Arab News
