5 days ago
Oman posts $1bln surplus on oil gains
MUSCAT: Oman posted a fiscal surplus of RO 540 million at the close of 2024, outperforming initial expectations and reversing a projected deficit of RO 640 million. The stronger-than-anticipated outcome was fuelled by robust oil revenues and disciplined expenditure, reinforcing the Sultanate's progress towards fiscal sustainability under Oman Vision 2040.
Citing the audited financial performance of the State General Budget for 2024, the Ministry of Finance noted that total state revenues reached RO 12.78 billion, representing a 16 per cent increase over the budgeted RO 11.01 billion. The uptick was largely attributed to favourable oil market dynamics. Oman's average oil price stood at USD 82 per barrel—well above the assumed USD 60—adding significant upside despite a decline in production volumes. Daily output averaged 997,000 barrels, compared to the budgeted 1.031 million barrels per day, reflecting Oman's continued adherence to voluntary OPEC+ cuts.
Oil revenues rose by 26 per cent year-on-year to RO 7.45 billion, while gas revenues climbed to RO 1.82 billion, marking a 16 per cent gain from budget estimates. Non-oil revenues remained broadly stable at RO 3.51 billion, marginally below expectations.
On the spending side, total public expenditure reached RO 12.24 billion, exceeding the original allocation of RO 11.65 billion by five per cent. The rise in expenditure was driven primarily by a surge in development spending, which grew by 31 per cent to RO 1.5 billion. Contributions and other payments increased 14 per cent to RO 2.2 billion, while current expenditure was maintained within target, declining slightly to RO 8.53 billion.
The Ministry of Finance stated that the increase in development spending reflects the government's ongoing efforts to support infrastructure expansion, social protection, and economic diversification. Additional spending was directed towards accelerating project delivery, enhancing public services, and stimulating domestic growth—all core objectives under Oman Vision 2040.
In parallel with its revenue performance, Oman made further progress on debt reduction. More than RO 660 million in public debt repayments were made during the year, bringing total outstanding debt down to approximately RO 14.6 billion. Additionally, over RO 1.6 billion in private sector obligations were fully settled through the automated financial cycle system, helping improve liquidity and bolster confidence among contractors and service providers.
The Ministry affirmed its commitment to responsible fiscal management and stated that the 2024 performance demonstrates the effectiveness of its macro-fiscal strategy. The combination of higher revenues, contained spending, and debt reduction enhances Oman's credit outlook and positions the economy for greater resilience in the years ahead.
As oil markets stabilise and domestic reforms advance, Oman's ability to generate fiscal space while investing in development priorities signals growing alignment with its long-term transformation goals. The 2024 budget execution stands as a key milestone in the country's journey towards balanced growth and economic diversification.
