Iran’s economy stalled to a near-standstill in the Persian year 1404, with gross domestic product expanding just 0.2% when oil is included and contracting 0.3% once petroleum is stripped out, according to the Statistical Centre of Iran. The figures, released on 1 Tir, mark a steep fall from 3.1% growth a year earlier and expose an economy hollowed out by a twelve-day war with Israel in the summer, a forty-day confrontation with US and Israeli forces in the winter, severe international sanctions and what domestic analysts describe as systemic corruption. The headline number remained positive only because oil and gas extraction grew 1.8%, masking deep declines in the sectors that touch daily life.

Beneath the surface, agriculture shrank 2.9%, manufacturing industry fell 1.5% and the water-and-electricity supply sector collapsed 6.5%. Private consumption dropped 1.4% and fixed capital formation fell 2.8%, with investment in machinery declining 5.8%—a forward indicator of eroding productive capacity. A 20% plunge in imports of goods and services, far outpacing a 2.1% fall in exports, arithmetically propped up the GDP calculation, but economists in Tehran note that such an import collapse signals acute foreign-exchange shortages, collapsing demand and disrupted supply chains rather than genuine resilience. The financial sector grew 8.4%, yet wholesale and retail trade, hotels and restaurants contracted 1.8%, underscoring a divergence between paper activity and the real economy.

Viewed from Riyadh, the picture is one of relative resilience under strain. Saudi Arabia’s business operating revenues rose 10.6% year-on-year in April 2026, driven by mining and quarrying (up 22.5%), finance and insurance (14.2%) and manufacturing (10.3%). But the monthly index fell 3.8% from March, and the mining surge reflects higher prices rather than expanded output: crude exports dropped to 5 million barrels per day in March, a 32% monthly decline, and production fell from 10.9 million barrels per day in February to 6.3 million in April as the Hormuz Strait disruption choked shipments. The IMF noted the economy’s “remarkable resilience” yet warned real GDP could shrink 1% for the full year, with a possible 10% year-on-year contraction in the second quarter if the strait remains obstructed. Bankruptcy filings tripled year-on-year to 31 cases in April, concentrated in construction and wholesale trade.

Argentina’s industrial and construction sectors, meanwhile, both recorded 2.8% year-on-year declines in April, reversing a brief March uptick. Only four of sixteen manufacturing branches posted gains, and construction input indicators remained weak, with three-quarters of private-sector firms expecting no change in activity. The data add to a global pattern of economic strain radiating from the Middle East conflict. In Iran, former pension-fund director Hojjatollah Mirzaei warned that growth could plunge to between minus 8.5% and minus 10% in the current year, pushing an additional 4.5 million people below the poverty line. The next factual milestone is the finalisation of Iran’s annual national accounts, which will confirm whether the winter quarter’s 2.2% contraction has carried into the new year, and the IMF’s updated Saudi assessment as Hormuz transit patterns evolve.