Back in June, Air Products said construction of Saudi Arabia’s NEOM Green Hydrogen Project had reached roughly 80% completion across multiple sites. The project includes a large-scale green hydrogen production facility, dedicated solar and wind farms, and a purpose-built transmission network. Once operational, it is expected to become the world’s largest renewable-powered ammonia complex within the next two years.
That progress, however, has unfolded against a much weaker oil backdrop than Riyadh anticipated when NEOM was conceived. Saudi Arabia’s fiscal capacity, still overwhelmingly tied to crude revenues, has come under pressure as oil prices have remained well below the levels assumed in early Vision 2030 planning. Brent has struggled to sustain prices high enough to comfortably fund multiple giga-projects simultaneously, forcing the Kingdom to reassess capital allocation across its most ambitious developments. As a result, spiraling construction costs combined with lower oil income have pushed Crown Prince Mohammed bin Salman to order a broad re-evaluation of NEOM’s scale and timelines.
Launched in 2017 by Mohammed bin Salman, the $8.8 trillion NEOM project was designed as the flagship of Saudi Vision 2030, aimed at reducing long-term reliance on oil revenues. But the irony is that NEOM’s funding remains tightly coupled to the very oil market it was meant to help Saudi Arabia move beyond. When crude prices soften, discretionary spending tightens, and capital-intensive projects like NEOM are among the first to be resized rather than canceled outright.
The Line was meant to be the centerpiece of NEOM: a 170-kilometer stretch of mirrored towers cutting through the desert, built on the assumption that Saudi Arabia could count on years of strong oil revenues to bankroll projects of that scale. That bet is no longer paying off. Oil prices have not generated the surplus Riyadh needs to push ahead with projects of this scale, and the Line has been cut back to a short pilot stretch, leaving most of the original route empty desert. What was pitched as a single, continuous megacity is now being broken up, with funding flowing only to parts of NEOM that can still be justified while the Kingdom juggles lower oil revenues and rising domestic spending.
In that context, the NEOM Green Hydrogen Project stands out not because it is immune to budget pressure, but because it is one of the few components that directly aligns with Saudi Arabia’s oil-market strategy. Green hydrogen and ammonia exports are increasingly framed as future revenue streams that could complement crude exports rather than replace them outright. This helps explain why the hydrogen complex has continued moving forward even as other NEOM elements have been delayed, downsized, or quietly shelved.
What is happening at NEOM comes down to oil. When prices are high, Saudi Arabia can afford to chase projects of this size. When they are not, plans get cut back. With crude prices falling short of what Riyadh needs to fund trillion-dollar builds, NEOM is being resized rather than scrapped. Vision 2030 is still the official plan, but it is now being shaped by a weaker oil market, not by the assumptions made when prices were higher.
#1. The Line
Status: Downsized
Originally planned to be built on 34 square kilometres of land, the Line was intended to showcase ‘‘never-before-seen efficiencies in city functions" with properties designed with a reduced infrastructure footprint. However, the ambitious 170km, 9-million-resident city has been significantly shrunk to a ~2.4km to 5km pilot phase dubbed the "Hidden Marina", with a target to be completed by 2030. The focus has shifted from a futuristic city to a more pragmatic, technology-driven hub, potentially utilizing its infrastructure for data centers and AI, with rising costs ($50 billion spent by late 2025) and falling oil prices compelling a re-evaluation of the overall $1.5 trillion budget. Most of the projected 170km area remains empty, with construction concentrated only on the initial section.
#2. Trojena
Status: Under Review/Downsized
Billed as the first ski resort in the Arabian Peninsula, Trojena is a pioneering $500-billion year-round mountain destination and outdoor ski resort situated in the Tabuk region’s mountains that reach an altitude of 2,600m. Situated 50 km from the Gulf of Aqaba, Trojena covers 60 km² of mountainous terrain, featuring 30 km of ski runs that would rely on advanced artificial snow production and year-round, cold mountain temperatures. The project includes a 2.8 km artificial freshwater lake, "The Vault" (a village built inside the mountainside), luxury hotels, and a wellness resort. However, reports have emerged that Trojena is currently under review, with the 2029 Asian Winter Games, formerly scheduled for Trojena, postponed after it became clear that the snow resort would not be completed in time. Trojena Sky Village, a key highlight of the facility, will also be downsized.
3. Sindalah
Status: Unclear
Sindalah is NEOM’s flagship luxury island destination, designed as a premier yachting and tourist hub. As part of Saudi Vision 2030 intended to boost tourism, the 840,000-square-meter island is designed to be a gateway to the Red Sea, offering year-round sailing. The island features an 86-berth marina for luxury superyachts with a yacht club designed by Stefano Ricci; three luxury hotels, including a Four Seasons Resort, along with 440 rooms, 88 villas, and 218 serviced apartments. The design aims to integrate with the surrounding marine ecosystem, which includes over 300 coral species and 1,000 fish species.
While a "soft launch" was celebrated in October 2024, reports indicate varying timelines on its full operational status. Following a series of delays, there were plans to move the project from NEOM to another Public Investment Fund in a bid to speed up development. It remains unclear whether the tourist hub will be completed as initially planned, amid reports of scale-backs and job cuts.
#4. Mukaab
Status: Scrapped
Located in the New Murabba downtown project in Riyadh, the Mukaab is a massive, 400m x 400m x 400m cube-shaped skyscraper designed as the largest single built structure on the planet featuring the world’s largest AI-powered, immersive display. Part of the Vision 2030, it is designed to be the world's largest enclosed structure, housing a "city within a cube" containing hotels, homes, and immersive entertainment. The interior is designed to hold 20 Empire State Buildings and features a spiraling tower, retail, cultural and residential spaces.
The Mukaab was controversial from the get-go thanks to similarities with the Kaaba in Mecca, regarded as the holiest site in Islam. Construction of the Mukaab has been suspended following a re-evaluation of its financial viability.
#5. Diriyah
Status: Under Construction
Diriyah is a historic town and a major $63 billion giga-project on the northwestern outskirts of Riyadh, Saudi Arabia, recognized as the birthplace of the Kingdom and the original home of the House of Saud. As a UNESCO World Heritage site (At-Turaif), it is being transformed into a premier cultural, heritage, and lifestyle destination, blending traditional Najdi mud-brick architecture with modern development as part of Vision 2030. It features the Jax District for arts and culture, and hosts major events like the Formula E Diriyah ePrix.
Diriyah is considered central to Vision 2030 thanks to its role in showcasing Saudi Arabia’s history and identity. It’s, therefore, unlikely to be scraped or even significantly scaled back.
#6. Qiddiya
Status: Under Construction
Situated in the Tuwaiq Mountains and covering over 360 square kilometers, Qiddiya is billed as the world's first city built specifically for entertainment, sports and culture. As a key component of Saudi Vision 2030, it aims to diversify the economy and improve quality of life. It features Six Flags Qiddiya City, which includes the record-breaking "Falcon's Flight" roller coaster, a Speed Park track for Formula 1, 12 theme parks, over 40 sports facilities, water parks and arts venues. It acts as a tourism hub, with 20% of the area devoted to public spaces, aiming to host millions of visitors annually and house over 500,000 residents.
Similar to Diriyah, Qiddiya is considered central to Vision 2030, with the city expected to be fully operational by 2034.
By Alex Kimani for Oilprice.com
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