Arabian shares plunged to a new 22-month low on Wednesday as worried investors sold ahead of planned protests in the kingdom, the world's top oil exporter.

Other Gulf Arab markets also slid, with the Kuwait and Dubai benchmarks slumping to six-year lows.

"It's all part of the re-rating of the market - risk premiums have gone up, so equity prices must come down and I don't think this adjustment is over yet," said Hashem Montasser, managing partner at Frontlane Capital, an asset management firm.

"Concerns about unrest in North Africa have now migrated to the Gulf, albeit in the smaller countries like Oman and Bahrain. The fear is that there will be a ripple effect into other GCC (Gulf) countries, so there's a lot of panic selling."

The Saudi index fell 3.9% to 5,323 points, slumping to its lowest close since April 22, 2009 and taking its losses to 19.7% since fatal "Day of Rage" protests erupted in neighboring Bahrain on Feb. 14.

"Fundamentals and economic factors are out - it's all about fear and panic and not knowing exactly what's happening in the market," said a Riyadh fund manager who asked not to be identified.

Activists have set up Facebook pages calling for protests in Saudi Arabia on March 11 and 20. Saudi Arabia has no elected parliament and parties and public dissent are banned by the Al Saud monarchy.

"There's a protest planned for the Eastern Province, which is where the Shi'ite minority and the oil are, and this sparked selling," said a Dubai-based analyst who asked not to be identified.

The Riyadh fund manager played down the significance of potential protests, saying these were instigated by non-Saudis and had little grassroots support.

Investors were unconvinced, with bank stocks hardest hit. Al Rajhi Bank, the Gulf Arab region's largest listed lender, fell 8% while SABB slid 6.4%.

High net worth investors were heavy sellers this week, causing the market to tumble through support levels. Local brokers then made margin calls, exacerbating declines and prompting redemptions at local asset management funds, while a lack of bid-side volumes also weighed.

"It's the herd mentality," said another Riyadh trader.

The cost of insuring Saudi Arabia's debt against default rose to its highest since July 2009.

Saudi five-year credit default swaps rose 9 basis points from Tuesday's close to 145 bps, while Bahraini 5-year CDS gained 14 bps to 315 bps.

Oil prices were flat, with Brent crude holding above $115 a barrel, having hit a 30-month closing high on Tuesday. "The huge increase in oil prices is potentially creating a stagflationary environment globally," said Amin El-Kholy, head of asset management at Arqaam Capital.

State-linked pension funds have been buying Saudi petrochemicals and cement stocks, but this does not constitute government support for the market, said the Riyadh fund manager.

"These are fund managers who buy for the long term and see a big opportunity in these stocks," he added. "Petrochemical stocks will benefit from higher oil price because their products are oil-price sensitive."

Protests in Bahrain are making forays away from the central square in Manama and into different parts of the city, pressing the Sunni-led government for swift democratic reform.