Commodities - Saudi Arabia

Saudi Arabia

The nominal value in the Commodities market of Saudi Arabia is forecasted to reach US$40.88bn in 2024.
It is anticipated to demonstrate an annual growth rate (CAGR 2024-2028) of 3.40%, leading to a projected total amount of US$46.73bn by 2028.
The average price per contract in the Commodities market stands at US$0.00 in 2024.
When compared globally, the highest nominal value is achieved the in the United States (US$45,690.00bn in 2024).
In the Commodities market of Saudi Arabia, the number of contracts is expected to reach 351,800.00k by 2028.
Saudi Arabia's increasing investment in oil-related commodities reflects its strategic focus on leveraging its dominant position in the global energy market.

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Analyst Opinion

In recent years, the Commodities market in Saudi Arabia has been experiencing a notable growth and evolution.

Customer preferences: Investors in Saudi Arabia have shown a growing interest in diversifying their investment portfolios, seeking higher returns. This has led to an increased demand for commodities as an alternative investment option compared to traditional assets.

Trends in the market: One of the key trends in the Saudi Arabian Commodities market is the rising popularity of trading in commodity derivatives. Investors are increasingly turning to derivatives due to their potential for higher leverage and the ability to speculate on price movements without owning the underlying asset. This trend is in line with the global shift towards derivative trading in commodities markets.

Local special circumstances: Saudi Arabia's strategic position as a major oil-producing nation plays a significant role in shaping its commodities market. The country's economy is closely tied to the fluctuations in global oil prices, which can impact investor sentiment and trading activity in commodity derivatives. Additionally, the government's initiatives to diversify the economy away from oil dependence have also influenced investment decisions in the commodities market.

Underlying macroeconomic factors: The overall economic stability and growth prospects of Saudi Arabia play a crucial role in driving the commodities market. Factors such as government policies, geopolitical developments, and global economic conditions can all impact the performance of commodity derivatives in the country. Additionally, investor confidence and risk appetite are influenced by macroeconomic indicators such as inflation, interest rates, and currency exchange rates.

Methodology

Data coverage:

Figures are based on commodity derivatives, their notional value, the number of contracts traded, the open interest (outstanding contracts at the end of a year), and the average value of a contract.

Modeling approach / Market size:

Market sizes are determined by a Bottom-Up approach, based on a specific rationale for each market segment. As a basis for evaluating markets, we use market research & analysis, and data of World Bank, as well as the World Federation of Exchanges. Furthermore, we use relevant key market indicators and data from country-specific associations and national data bureaus such as GDP, wealth per capita, and the online banking penetration rate. This data helps us to estimate the market size for each country individually.

Forecasts:

In our forecasts, we apply diverse forecasting techniques. The selection of forecasting techniques is based on the behavior of the particular market. In this market, we use the HOLT-damped Trend method to forecast future development. The main drivers are GDP per capita an the online banking penetration rate.

Additional Notes:

The market is updated twice per year in case market dynamics change.