Oil revenue lifts Oman to $1.2 bln budget surplus in first quarter

An increase in net oil revenue of 9 percent in the first quarter on higher oil prices and increased production helped Oman to a budget surplus of 450 million rials ($1.17 billion) in the period, da-ta from the finance ministry showed on Tuesday.

Net oil revenue at the end of March 31 amounted to 1.71 billion rials, based on an average price of $85 per barrel, from 1.57 billion rials in the same period a year ago, helping lift total revenue during the period by 6 percent to 3.22 billion rials.

Spending in the first quarter also increased, up by 4 percent over the prior year period, to 2.77 billion rials.

“At the end of Q1-2023, the budget registered a surplus of 450 million rials compared to a surplus of 357 million rials achieved over the same period in 2022,” the latest fiscal performance report said.

Oman is among the weaker economies of the Gulf oil and gas exporters but higher oil prices have supported public finances and helped to reduce government debt.

Last month, the finance ministry said it had repaid 1.1 billion rials in loans in the first quarter bringing total public debt at the end of March to 16.6 billion rials.

Total debt was 17.7 billion rials at the end of 2022.

However, Gulf economies are expected to grow at a slower rate in 2023 as a lower oil price outlook and global macroeconomic worries could weigh on revenue.

The International Monetary Fund projects GDP growth to ease to 1.7 percent in 2023 from 4.3 percent last year, before recovering to 5.2 percent in 2024 in its latest regional outlook report released last week.

Oman’s economy remains reliant on revenue from hydrocarbons despite plans to diversify into sectors such as tourism and logistics.