This study examines the dynamic interactions between oil price shocks, monetary policy, and non-oil output in Saudi Arabia using Vector Autoregressive Model (VAR), and quarterly data spanning 2010: Q1–2025: Q3. The study aims to provide policy-relevant insights through which external oil price shocks and domestic monetary policy shocks affect inflation and non-oil economic activity in the context of Saudi Arabia’s structural transformation under Vision 2030. The results show that global oil prices behave largely as exogenous shocks, with limited feedback from domestic monetary conditions, implying that monetary policy effectiveness operates primarily through inflation and domestic demand channels rather than through oil prices directly. The findings underscore the importance of gradual and predictable monetary tightening, coordinated with fiscal and macroprudential policies, to mitigate the indirect spillovers of oil price volatility on the non-oil sector. While monetary policy plays a stabilizing role by containing inflation and supporting macroeconomic balance, sustaining diversification and non-oil growth under Vision 2030 requires complementary measures, including targeted credit support, financial market deepening, and structural reforms that enhance productivity and private-sector investment.

Environmental degradation has intensified alongside rising carbon emissions driven by economic expansion, energy consumption, and transport activities. In recent decades, Middle Eastern economies have experienced substantial growth in tourism, trade openness, and energy use, raising concerns about their environmental consequences. This study investigates the impact of tourism activity, energy consumption, and trade openness on transport-related CO₂ emissions in ten Middle Eastern countries over the period 2000–2020. Data were obtained from the World Development Indicators (WDI) database of the World Bank. Using a panel autoregressive distributed lag (ARDL) framework, the analysis captures both short-run dynamics and long-run equilibrium relationships. To improve measurement robustness, tourism activity is proxied using two alternative indicators: international tourism expenditures (TEs) and international tourism receipts (TRs). The empirical results indicate that tourism activity and energy consumption significantly increase transport-related CO₂ emissions in both the short and long run, while trade openness does not exert a statistically significant long-run effect. These findings suggest that tourism expansion and energy-intensive transport systems are key contributors to environmental pressure In the region, whereas the environmental impact of trade may be indirect or conditional. The study highlights the importance of integrating sustainable tourism policies and improving energy efficiency. In addition, it underscores the need to develop low-carbon transport strategies to support environmentally sustainable economic development in Middle Eastern economies.