On the back of higher-than-anticipated oil and gas revenues, the sultanate posted a record RO1.47bn fiscal surplus in the first four months of this year against a deficit of RO114.5mn in the same period of 2011, according to statistics released by the erstwhile Ministry of National Economy.
The government's total revenue surged 39.6 per cent to RO4.6bn in the four-month period. Oil revenue, which accounts for 71 per cent of total revenue, rose 35 per cent to RO3.27bn, while gas revenue jumped to RO687mn from RO330mn.
Margaret Purcell, chief economist at BankMuscat, said that the rise in budget surplus is largely due to the increase in hydrocarbon revenues.
She said, "Oman is expected to have positive year in terms of its fiscal balance as although oil prices have declined substantially since March, the average for the year remains at US$112 per barrel well above the budget forecast of US$75 per barrel."
"It is interesting to note that although net oil revenue rose in April, there was a far larger increase in gas revenue.
"This along with a rise in other revenue all helped to offset the continued rise in current expenditure and participation and support to private sector," Purcell added.
The average price at which Oman sold its crude oil rose by 22 per cent to US$111.17 a barrel in the four-month period.
Dr Fabio Sacciavillani, chief economist of Oman Investment Fund, said that Oman has a solid fiscal position which is now widely recognised domestically and globally.
He said, "Oman's economy is growing on a sustainable basis. The massive surplus is mainly a reflection of higher-than-anticipated oil prices.
"Going forward, oil demand and prices will depend on global economic conditions and demand from Asian countries particularly."
© Muscat Daily 2012
