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Oman raises spending 5.3pc in H1

Muscat, August 10, 2009

Oman has raised spending on infrastructure and oil production projects by 5.3 percent to 3.23 billion rials ($8.4 billion) in the first six months of 2009, the national economy ministry said.

Spending on infrastructure projects rose 25 percent to 539.1 million rials while expenditure for oil climbed 18 percent to 358.9 million rials year on year, ministry figures showed.

State spending on defence and security edged up 1.4 percent but the sultanate cut back on subsidies to the private sector by 23 percent.

Total revenues dropped 21.3 percent to 3.24 billion rials in the first half of the year as oil export earnings slumped 33 percent to 1.8 billion rials, according to the ministry's data.

Oman, a non-Opec oil exporter, has projected a budget deficit of 810 million rials in 2009, based on an oil price at $45 a barrel. Crude prices have recovered from lows around $32 a barrel in December to around $70.

Oman eked out a tiny budget surplus in the first five months of the year despite a more than 30 percent decline in oil revenues over the same period, official data showed in July.

Gulf states have seen revenues fall with the slump in oil prices from a peak near $150 in July 2008, prompting some in the world' top oil exporting region to face rare budget deficits.

Oman pumps around 790,000 barrels per day and says it is targeting output of 800,000 bpd in 2009. 

Meanwhile, the annual inflation in Oman fell to 2.88 percent in June from 3.9 percent in May, the Ministry of National Economy said.

The country's annual inflation rate peaked at almost 14 percent in the middle of last year but has steadily retreated as oil prices retreated from record peaks in July 2008. - Reuters




Tags: Oman | Infrastructure | Spending |

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