The mysterious disappearance of Saudi journalist Jamal Khashoggi since Oct. 2 has made Saudi Arabia's main stock market dropped to as much as 9 percent on Sunday. The plunge scaled off the majority of the market's gains in 2018.
Aside from the impact on Riyadh's market, Khashoggi's disappearance has resulted in a fallout between Saudi Arabia and the international community.
While the Riyadh market is still up 8 percent from a year ago, big businesses have started to pull out from their ventures in the country.
Most recently, British billionaire Richard Branson has canceled his involvement in building infrastructure for the Red Sea tourism project, CNN reported. The billionaire has also bowed out from discussions with the Saudi government about a supposed $1 billion investment with his space companies.
Overall, the issue is expected to delay the kingdom's Vision 2030, a plan intended to help Saudi diversify its economy from oil exportation.
At the heart of the matter is the unexplained disappearance of Saudi journalist Khashoggi who has been residing in the United States. The Washington Post journalist and a strong critic of the current Saudi administration vanished after visiting the Saudi consulate in Istanbul; nothing has come out about his whereabouts since then.
Turkish officials believed Khashoggi was murdered inside the consulate and his body was removed from the scene, but nothing was confirmed yet.
U.S. President Donald Trump threatened to impose economic sanctions against Saudi Arabia if the ongoing investigation proved that the journalist, indeed, was murdered inside the Saudi consulate.
The kingdom, on the other hand, strongly denied the allegations but said would retaliate to nations that would impose economic sanctions against Saudi.
Analysts have started issuing warnings on possible chaos for the global oil markets.
Any retaliation from the kingdom will result in reduced oil supply worldwide and higher prices, said Robert Carnell, the chief economist at ING.
Depending on how the sanctions could be, Saudi may be compelled to "weaponize" oil exportation, Allianz chief economist Michael Heise told CNBC. He added that he is "not too optimistic" about the current situation.
Khashoggi went to the Saudi consulate in Istanbul finalize paperwork for his wedding to his Turkish fiancé, Hatice Cengiz.
The 59-year-old Saudi journalist has been residing in Virginia since 2017. He has been in self-imposed exile since last year and has since been writing for the Washington Post. His columns were usually loaded with strong personal opinions against the present regime of Crown Prince Mohammed bin Salman. Particularly, he criticized the Crown Prince for allegedly stifling the freedom of speech.
