Oman revenues from oil amounted to 1.7 billion Omani riyals (Dh16.21 billion) during the first quarter of this year, according to the latest government financial figures.

The figures revealed a drop in net oil revenues by more than 35% since the beginning of the year to March.

The drop in export revenue was due to the slump in the oil and gas prices in the international market.

Oil exports rose by 6.2%, compared to the same period last year. Spending on oil production marked a rise, amounting to 194 million riyals, compared to 93 million riyals for the same period last year.

The figures also revealed higher spending on gas production at 104.4 million riyals compared to 77 million riyals from the same period last year.

The government has already started to reduce spending during the first quarter of this year including support and contributions provided by the various goods and major products.

Oman reduced subsidies on various food items such as rice, flour and sugar as well as fuel and other products by 173 million riyals in the first quarter of 2015, according to a government report.

The latest report from the Ministry of Finance revealed that the total expenditure paid by the government for subsidies fell by 47.9% in the first three months of 2015 compared with the same period last year.

Oman’s budget deficit for 2015 is estimated to be 3.6 billion riyals, according to the International Monetary Fund (IMF), which is 13.2 per cent of the country’s gross domestic product (GDP).

Economic experts believe that the sharp decline in oil prices puts pressure on Oman to introduce economic reforms such as the cutting of energy subsidies.

Source: Gulf News