Figures from the Ministry of Finance in Oman reveal that the Sultanate repaid 1.1 billion Omani rials ($2.86 billion) of loans in the first quarter, bringing the total public debt to 16.6 billion rials by the end of March. Total debt was 17.7 billion rials at the end of 2022.
Increased production alongside rising oil prices has resulted in a budget surplus of 372 million rials by the end of February, compared to 210 million rials during the same period the previous year. Meanwhile, the country's total revenues grew by 12 percent by the end of February 2023, while public spending increased by four percent.
The Ministry of Finance indicated that "oil and gas revenues represent about 80 percent of total public revenues, making the Sultanate more vulnerable to global fluctuations in oil prices." Net oil revenues reached 1.15 billion rials by the end of February, up from 1.09 billion rials in the same period a year earlier, driven by an increase in the average oil price to $86 per barrel during this period from $81 per barrel at the end of February 2022.
The financial performance bulletin issued by the ministry noted that "Oman, being one of the weaker economies in the Gulf region, repaid its debts relying on increased government revenues following the rise in oil prices."
Earlier this month, the rating agency "Standard & Poor's" revised its outlook for the Sultanate of Oman from stable to positive, stating: "The government is implementing budget reforms and has reduced the total debt ratio to 40 percent of GDP in 2022 from around 60 percent in 2021."
The agency forecast that "Oman's GDP is expected to grow by about 2.5 percent annually on average between 2023 and 2026." Earlier this month, Oman agreed to a voluntary reduction in oil production by 40,000 barrels per day starting in May until the end of 2023, a move adopted by other member countries of the "OPEC+" alliance, leading to a rise in oil prices.
Oman launched a medium-term financial plan in 2020 to reduce public debt, diversify revenue sources, and stimulate economic growth.
