Saudi Aramco raised domestic diesel prices by 8 percent effective 1 January, prompting several Saudi-listed companies, led by cement producers, to warn of higher production costs.
Steady Price Increases Since 2022
Diesel now costs SAR1.79 ($0.48) per litre, up from SAR1.66 in 2025, according to Aramco’s website. The state oil giant, which is 81.5 percent government-owned, has conducted annual diesel price reviews at the start of each year since 2022.
Prices have risen sharply over that period, from SAR0.63 per litre in 2022 to SAR0.75 in 2023, SAR1.15 in 2024, and SAR1.66 last year.
Aramco Shares Edge Higher
Aramco shares ended Thursday’s session 0.2 percent higher at SAR23.88 on the Saudi Exchange, though the stock remains down nearly 15 percent over the past 12 months.
Cement Producers Flag Higher Costs
In filings to the exchange, Riyadh Cement, Umm Al-Qura Cement, Northern Region Cement, Qassim Cement and Arabian Cement said the diesel hike would increase manufacturing costs by between 6 percent and 11 percent.
Middle East Paper Co and the Power and Water Utility Company for Jubail and Yanbu (Marafiq) also said the higher diesel price would negatively affect their cost of sales.
Saudi Arabia applies a 15 percent value-added tax to diesel prices.
Vision 2030 and Fuel Displacement Strategy
The price adjustment comes as part of broader energy reforms under Vision 2030. The government is rolling out a fuel displacement programme aimed at replacing liquid fuels with natural gas and renewable energy across manufacturing, power generation, industry and agriculture.
The initiative targets the displacement of more than 1 million barrels of oil per day by 2030, while supporting emissions reductions and long-term energy efficiency.
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