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Buoyed by resurgent oil and gas prices and increasingly strong fiscals, the Sultanate of Oman’s 2022 Budget registered a surplus of RO 357 million at the end of first quarter, as compared to a deficit of RO 751 million over the same period in 2021.
Shedding light on the country’s fiscal performance for Q1 2022, the Ministry of Finance noted that the surplus will be utilised towards three key objectives: Accelerating economic recovery, Enhancing development spending and Mitigating the risks of public debt portfolio.
Public revenue, bolstered by strong hydrocarbon export earnings, surged 66.3 per cent to RO 3.025 billion, up from RO 1.819 billion for the corresponding period of 2021. The biggest contribution came from crude oil, with net revenue soaring 70.2 per cent to RO 1.565 billion, up from RO 919 million in Q1 2021. This is credited to a higher average oil price of $78 per barrel and an uptick in average oil production to 1.025 million barrels per day this year, versus an average oil price of $45 and an output of 952K barrels per day in Q1 2021.
Gas revenue also surged 124.4 per cent to RO 454 million, up from RO 365 million for Q1 2021. Current revenue increased by 23.7 per cent to RO 636 million, up from RO 514 million last year. VAT receipts totalled RO 69 million, while excise tax of RO 24 million help boost the collection of government revenue, the Ministry stated in its latest newsletter.
Public spending, on the other hand, inched up 3.8 per cent to RO 2.668 billion, up from RO 2.570 billion in Q1 2021. The current expenditure of civil ministries and units registered almost similar figures of the same period in 2021. Moreover, the public debt service registered an increase to RO 291 million.
The development expenditure of civil ministries and units increased by 130.8 per cent to RO 150 million compared to the same quarter in 2021. The total amount spent represents 13.6 per cent of total development budget allocated for 2022 i.e. RO 1.100 billion. Contributions and other expenses amounted to RO 179 million, including RO 50 million allocated for public debt service, the report stated.
Significantly, an amount totalling over RO 146.4 million was paid by the Ministry to private sector in Q1 2022. “This reflects the payment vouchers received through the e-financial system, and which have completed the documentary cycle'', it noted.
Citing the MENA Economic Update, the report stated that the Sultanate of Oman’s economy is projected to recover as measures against the Covid-19 pandemic continued to be lifted, and also due to higher oil prices and production. The gross domestic production (GDP) is projected to grow to 5.6 per cent supported by a growth of more than 8 per cent and 2 per cent in oil and non-oil sectors, respectively, in 2022. However, the GDP is projected to decrease to 2.7 per cent on average in 2023 and 2024.
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