Oman records $2.9bn budget surplus in first nine months of 2022

Sultanate's revenue in January-September period climbed 43.4% on an annual basis

Oman's 12-month fiscal surplus is expected to amount to 6.5 per cent of its total gross domestic product this year, Fitch estimates. Silvia Razgova / The National

Oman recorded a budget surplus of more than 1.12 billion rials ($2.91bn) in the first nine months of this year, compared with a deficit of more than 1bn rials in the same period of last year.

The Gulf country's total public revenue in the January-September period jumped 43.4 per cent to nearly 10.6bn rials, up from 7.4bn rials last year.

Total public spending until the end of September this year increased by 12.5 per cent to reach about 9.4bn rials. Last year the total was nearly 8.4bn rials.

The development expenditure was 657 million rials, representing 60 per cent of total development spending allocation of 1.1bn rials for 2022.

Oman is poised to post its first yearly fiscal surplus in a decade this year, said a Fitch Solutions report released in August.

The sultanate's 12-month fiscal surplus is expected to amount to 6.5 per cent of its total gross domestic product, Fitch says. Revenue will rise further in the second half of the year because of high energy prices, it said.

By the end of September this year, hydrocarbon revenue increased to more than 8.1bn rials, up by 51.9 per cent compared with 5.3bn rials last year.

“Such increase is supported by higher average oil price of $94 per barrel, as well as an increase in crude oil production to 1.05 million barrels per day from 957,000 barrels a year ago,” the Omani government said.

Net oil revenue in the first nine months of this year was up 37 per cent to over 5.3bn rials.

The Brent crude oil spot price is projected to average $93 per barrel in the fourth quarter of this year and $95 per barrel next year, says the US Energy Information Administration’s latest report.

Global economic activity is experiencing a slowdown, with inflation the highest for several decades, said the International Monetary Fund’s world economic outlook report. It predicts global growth to slow from 6 per cent last year to 3.2 per cent in 2022 and 2.7 per cent in 2023.

The IMF also forecasts global inflation to rise from 4.7 per cent in 2021 to 8.8 per cent in 2022, but to decline to 6.5 per cent and 4.1 per cent in 2023 and 2024, respectively.

It projected that Oman’s real gross domestic product will grow from 3 per cent in 2021 to 4.4 per cent and 4.1 per cent in 2022 and 2023, respectively.