Saudi Arabia Natural Gas Market

Saudi Arabia Natural Gas Market Overview:

The Saudi Arabia natural gas market size reached USD 10.14 Billion in 2024. Looking forward, IMARC Group expects the market to reach USD 20.71 Billion by 2033, exhibiting a growth rate (CAGR) of 7.40% during 2025-2033. Saudi Arabia is diversifying its energy sources, focusing on natural gas to reduce oil dependence and enhance sustainability. Investments in advanced technologies and infrastructure, including gas storage and processing facilities, aim to meet domestic and global demand. This supports Vision 2030’s goals of economic diversification and cleaner energy and contributes to the expansion of the Saudi Arabia natural gas market share.

Saudi Arabia Natural Gas Market Trends:

Rising Energy Demand from Increasing Population

The growth of the population and rising urbanization rates are major contributors to the market expansion. As per the General Authority for Statistics, the population projections showed a growth rate of 4.7%. In 2024, the total population of Saudi nationals surpassed 19.6 Million, an increase from 19.3 Million in 2023. With a broadening urban base and increasing industrialization, electricity utilization is rising. Natural gas plays a central role in power generation, offering a cleaner and more cost-effective alternative to crude oil. As the government continues to expand housing projects, commercial zones, and industrial clusters, the reliance on natural gas for sustainable and reliable energy is becoming stronger. Household consumption, air conditioning, and desalination plants also heavily depend on gas supply. This increasing energy demand ensures long-term stability for the natural gas sector.

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Expansion of Power Generation Capacity

Saudi Arabia’s increasing electricity demand is driving the rapid expansion of power generation capacity, with natural gas at the forefront. Gas-fired power plants are more efficient, cost-effective, and environment-friendly than oil-based alternatives, making them central to new energy projects. The government is investing heavily in modern combined-cycle power plants that use natural gas to deliver higher energy efficiency. With rising demand from households, commercial centers, and industrial zones, natural gas has become the backbone of the electricity sector. Additionally, the development of new power grids and renewable integration requires reliable base-load generation, where natural gas is highly effective. As per the IMARC Group, the Saudi Arabia power grids market size reached USD 2.25 Billion in 2024. The shift towards gas-powered plants also aligns with Saudi Arabia’s strategy of exporting more oil rather than burning it domestically.

Economic Diversification and Vision 2030 Goals

Saudi Arabia’s Vision 2030 is a key driver of the natural gas market growth, as it emphasizes reducing reliance on crude oil revenues and diversifying the energy mix. Natural gas is positioned as a central pillar to support new industries, sustainable energy policies, and export strategies. The government is aiming to maximize oil exports by substituting natural gas for domestic energy use. As per the Trading Economics, Saudi Arabia's oil exports rose to 64677 SAR Million in June 2025, up from 59330 SAR Million in May 2025. This aligns with economic diversification by supporting power generation, industrial production, and downstream petrochemical growth. Vision 2030 also highlights clean energy transitions, where natural gas serves as a bridge fuel alongside renewables. Moreover, foreign partnerships and technology transfer under Vision 2030 are strengthening Saudi Arabia’s natural gas infrastructure.

Key Growth Drivers of Saudi Arabia Natural Gas Market:

Industrial Growth and Petrochemical Demand

Saudi Arabia’s industrial expansion, particularly in petrochemicals, fertilizers, and manufacturing, is significantly catalyzing natural gas demand. Natural gas is not only a fuel but also a critical feedstock for petrochemical production, including ammonia, methanol, and other derivatives. Industrial clusters in Jubail and Yanbu rely heavily on steady gas supplies to sustain operations and export activities. With the government emphasizing diversification, industries beyond oil are being prioritized, and natural gas forms the energy foundation of this transformation. Additionally, investments in new industrial cities and advanced manufacturing facilities are accelerating the demand. The fertilizer industry, crucial for global agriculture markets, also depends on abundant natural gas supply. By supporting large-scale industrial output and exports, natural gas usage continues to rise.

Investments in Infrastructure and Distribution Networks

Saudi Arabia is heavily investing in natural gas infrastructure, inculcating pipelines, processing facilities, and distribution systems, to meet rising demand. Mega projects are strengthening the transportation and delivery of natural gas across the Kingdom. These infrastructure upgrades ensure efficient supply to industrial zones, power plants, and residential areas. The expansion of liquified natural gas (LNG) terminals and gas processing plants also enhances the country’s capacity to handle growing production. By improving storage and transmission networks, Saudi Arabia is ensuring energy security and reducing reliance on liquid fuels. Furthermore, partnerships with global technology providers bring advanced solutions for gas handling and distribution. As infrastructure development continues, the accessibility and reliability of natural gas are increasing, encouraging higher adoption across sectors.

Rising Role of Natural Gas in Hydrogen Production

Saudi Arabia’s ambition to become a global leader in hydrogen production is further driving natural gas demand. Blue hydrogen, manufactured using natural gas with carbon capture, is gaining prominence as part of the country’s clean energy strategy. With global demand for hydrogen expected to grow, natural gas serves as a reliable input for large-scale hydrogen projects. Saudi Arabia is investing in advanced carbon capture technologies to reduce emissions while leveraging abundant gas reserves. Hydrogen produced from natural gas is set to play a key role in export markets and domestic clean energy transitions. This growing link between natural gas and hydrogen supports both environmental goals and economic diversification. By integrating natural gas into future energy solutions, Saudi Arabia is reinforcing its global competitiveness and ensuring steady growth in natural gas consumption for decades ahead.

Saudi Arabia Natural Gas Market Segmentation:

IMARC Group provides an analysis of the key trends in each segment of the market, along with forecasts at the country and regional levels for 2025-2033. Our report has categorized the market based on type.

Type Insights:

• Compressed Natural Gas
• Piped Natural Gas
• Liquified Petroleum Gas

A detailed breakup and analysis of the market based on the type have also been provided in the report. This includes compressed natural gas, piped natural gas, and liquified petroleum gas.

Regional Insights:

• Northern and Central Region
• Western Region
• Eastern Region
• Southern Region

The report has also provided a comprehensive analysis of all the major regional markets, which include Northern and Central Region, Western Region, Eastern Region, and Southern Region.

Competitive Landscape:

The market research report has also provided a comprehensive analysis of the competitive landscape. Competitive analysis such as market structure, key player positioning, top winning strategies, competitive dashboard, and company evaluation quadrant has been covered in the report. Also, detailed profiles of all major companies have been provided.

 Saudi Arabia Natural Gas Market News:

• August 2025: Saudi Aramco entered into an USD 11 Billion lease-and-leaseback deal with a consortium headed by Global Infrastructure Partners, a part of BlackRock, for midstream assets related to its Jafurah gas project. According to the agreement, the newly established Jafurah Midstream Gas Co. would acquire rights for the development and use of the Jafurah Field Gas Plant and the Riyas NGL Fractionation Facility, subsequently leasing them back to Aramco for a period of 20 years. BlackRock aimed to strengthen its collaboration with Aramco through investments in the natural gas infrastructure of Saudi Arabia, an essential component of worldwide natural gas markets.
• May 2025: Saudi Arabia granted a USD 2.6 Billion contract to a joint venture between Spanish and Egyptian companies to construct a 3 GW combined cycle natural gas-fired power plant in the Eastern Province, aiding the rise in electricity production from natural gas. The initiative encompassed carbon capture preparedness and a 380 kV electrical substation. This coincided with Saudi initiatives to enhance clean energy and electrical capacity.
• April 2025: Saudi Aramco revealed the discovery of 14 additional oil and natural gas fields and reservoirs in the Eastern Region and the Rub' al Khali. This encompassed two natural gas fields, Ghizlan and Araam, and four gas reservoirs, yielding substantial daily outputs reaching 32 Million standard cubic feet.

Saudi Arabia Natural Gas Market Report Coverage:

 
Key Benefits for Stakeholders:

• IMARC’s industry report offers a comprehensive quantitative analysis of various market segments, historical and current market trends, market forecasts, and dynamics of the Saudi Arabia natural gas market from 2019-2033.
• The research report provides the latest information on the market drivers, challenges, and opportunities in the Saudi Arabia natural gas market.
• Porter's five forces analysis assist stakeholders in assessing the impact of new entrants, competitive rivalry, supplier power, buyer power, and the threat of substitution. It helps stakeholders to analyze the level of competition within the Saudi Arabia natural gas industry and its attractiveness.
• Competitive landscape allows stakeholders to understand their competitive environment and provides an insight into the current positions of key players in the market.