WASHINGTON, D.C. — After a series of deadly strikes hit Saudi Arabia’s main international airport, the kingdom’s economy faces heightened uncertainty, as investors worry that disruptions could curtail oil output and delay the upcoming World Expo in Riyadh.

Saudi Arabia’s state‑owned airline, Saudia, reported a 12% decline in passenger traffic in the first quarter, citing security concerns and flight cancellations. The International Air Transport Association (IATA) estimates that the strikes have cost the sector about $3.5 billion in lost revenue, a figure that could ripple through the broader economy.

On the trading floor, the Tadawul All‑Share Index slipped 2.6% on Tuesday, its largest single‑day drop since the 2021 pandemic slump. Analysts say the market reaction reflects fears that the strikes could force a temporary halt in the kingdom’s 12 million barrels‑per‑day oil production, which underpins 70% of Saudi revenues.

“While the government has pledged to maintain production levels, any sustained disruption at the airport could delay logistics and supply chains essential to the oil sector,” said Dr. Aisha Al‑Khaled, senior economist at the Middle East Institute. “Investors are watching closely as the central bank’s policy stance and the Fed’s rate outlook converge on the same global inflation narrative.”

International investors are also wary of the potential impact on the World Expo 2030, scheduled to open in Riyadh next month. The event’s organizers announced a 15% increase in security costs, citing the need for additional air‑traffic coordination and emergency response teams.

Market Reaction

• Saudi Arabia’s Tadawul index fell 2.6% on Tuesday, a sharp decline amid security concerns.
• Oil production could see temporary reductions, threatening the kingdom’s $700 billion annual revenue.
• World Expo 2030 faces increased security spending, potentially delaying project milestones.

With the Federal Reserve expected to keep policy rates unchanged until at least early 2027, global investors are seeking safe‑haven assets. The recent volatility underscores the interconnectedness of geopolitical risks and commodity markets, reminding stakeholders that stability in Saudi Arabia remains a key pillar of global energy security.