Oman’s revenues from oil dropped by 45.5%

Muscat: Oman’s revenues from oil for the first nine months of 2015 dropped 45.5 per cent when compared to the same period last year.

Oil revenue at the end of September stood at 4.2 billion rials, compared to 7.8 billion rials in the nine months of 2014, according to the National Centre for Statistics and Information.

Total revenues were estimated at 6.7 billion rials for the period, a decline 35.9 per cent. Customs taxes were down 1.9 per cent and corporate income tax dropped 2.6 per cent.

However, according to the statistics, overall spending has declined decreased by 1.8 per cent, with spending on defence and national security down by 9.6 per cent. Spending on civil ministries rose by 0.6 per cent. Spending on oil and gas production increased by 23.2 per cent and 95.2 per cent respectively.

The Central Bank of Oman said recently that the main challenge faced by Oman under the current economic situation is to avoid any slowdown in the growth and economic diversification, along with the need to increase employment opportunities.

Darwish Bin Esmail Al Beloushi, Minister Responsible for Financial Affairs said that Oman has no plans to cut fuel subsidies. Subsidies on petroleum products, including petrol and diesel, are estimated to have cost Oman an estimated 900 million rials (Dh8.56 billion) in 2015, compared to 840 million rials in 2014.

Al Beloushi told the Oman Shura Council that living standards of citizens were guaranteed.

Al Beloushi affirmed that the measures taken by the government since the beginning of the oil price crisis, especially expenditure rationing have contributed to the alleviation of its impact on the general budget both in terms of spending or revenues.

Al Beloushi added that the government will continue to cut spending in order to reduce the deficit, adding that the government is constantly revising all expenditure items, as well as for non-oil revenues, which will be reflected on the 2016 budget, as well as the 9th Five-Year Plan “without prejudice to the economic and social activity.”

Nasser Al Jasmi, undersecretary of the finance ministry, said that Oman’s budget amounted to 2.7 billion riyals (Dh25.7 billion) until the end of the August.

Al Jasmi said oil contributes up to 75 per cent of Oman’s revenues and any drop in oil prices has a direct impact on the budget.

The Financial Affairs and Energy Resources Council has formed a specialised working group last September to study public spending and the means to reduce it amid the slump in oil prices.

The council said in a statement that the government efforts to control spending and to increase non-oil revenues have helped falling revenues.