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Oman’s Soaring Surplus to Help Finance Government Expansion

Rising Oil Prices Helping Oman Finance Government Expansion

Oman’s fiscal surplus has soared over the past seven months by a factor of five, according to government data. The surplus was fueled by rising prices of oil and increased production, and outpaced even what was a large increase in public expenditures.

The actual surplus for the first seven months of 2012 came to RO 2.041 billion ($5.31 billion) while the surplus for the same time period in 2011 was only RO 442.3 million ($1.150.3 billion.)

Most of the surplus came from an increase by 34 percent in oil export earnings due to a rise in Oman’s oil production. In addition the price of Oman’s crude oil rose from about $100 per barrel to an average of $113.2 per barrel during the same period, further boosting the surplus.

Oman has five billion barrels of proven oil reserves under its control, as well as 25 trillion cubic feet of natural gas. Government officials are planning on increasing government spending over the next few years in its 2011 through 2015 development plan by a huge 113 percent.

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