Oil below $80 a barrel ‘not a problem’ for Oman, minister says

Vienna: Oman, a member of the OPEC+ cartel, said it’s unconcerned by oil’s drop of more than 10 per cent this year as the global economy slows.

It’s “not a problem” for the Gulf sultanate if oil averages less than $80 a barrel, Said Al Mawali, the Gulf sultanate’s minister of transport, communications and information technology, said on Thursday.

The International Monetary Fund forecasts a fiscal surplus for Oman this year of 0.3 per cent of gross domestic product. It estimates that Oman, which pumps around 1 million barrels a day, or 1 per cent of global supply, needs crude prices to be just over $72 a barrel to balance its budget. Benchmark Brent oil has fallen 11 per cent since the end of 2022, but remains above that level at around $76.50.

Other members of OPEC+, including Saudi Arabia, Russia and Algeria, have announced supply cuts in recent months in a bid to prop up prices. Russia’s attack on Ukraine led to a windfall for exporters last year, including Oman, with Brent averaging $100 a barrel.

Al Mawali said fiscal reforms have boosted Oman’s financial position, with about 25 per cent of government debt “wiped out over the last three years.”

A railway system between Oman and neighboring UAE is being accelerated and “within five years, we will have these rails rolling,” he said.