Complex Made Simple

Oman cuts spending due to low oil prices

Budget deficit for 2016 is expected to reach nearly $8.6 billion

Oman announced on Friday that it will cut spend in its new budget by 15.6 per cent due to lower oil prices.

In a statement carried by Alhurra, finance minister, Darweesh al Balushi, said: “Spending is projected at $30.9 billion in 2016.”

The budget deficit for 2016 is expected to reach nearly $8.6bn. Oman’s deficit last year was $11.7bn.

Omani cabinet had earlier this week approved, in principle, spending cuts, tax increases and fuel subsidy reforms.

These actions come days after Saudi Arabia raised the price of fuel and other oil derivatives, water and electricity by up to 67 per cent.

Oil has lost more than 50 per cent of its price since mid- 2014, which could deprive the GCC countries from revenues estimated at $275bn, according to the International Monetary Fund.

(US$1 = AED3.66, at the time of publishing)