Commodities, Emerging Markets, Energy, Frontier Markets, Stocks

Middle East: Oman’s Subsidies To Exceed $7 Billion This Year According To IMF Study

Oman’s total subsidies will touch $7.27 billion this year, the International Monetary Fund (IMF) reports in a study.


This is against a subsidy estimate at $4.64 billion for 2015 in the state budget and an actual subsidy of $4.36 billion in 2014, which indicated a fall of 17.11 per cent over the previous year due to a plunge in oil prices, Times of Oman reports.

Oman will achieve a nominal gross domestic product (GDP) of $81.64 billion in 2015, with population of around 4 million, the IMF study noted.

The Oman government has been contemplating withdrawing fuel subsidies for the last few years, but no decision has been yet taken due to its far-reaching implications on the entire society. However, the Central Bank of Oman recently favoured a phased reduction in the government subsidy, according to the news agency.

It’s worth noting that energy consumption in the Sultanate has been growing steadily as the main driver of the growth in subsidies.

Oman’s government grants subsidies to producers of various essential items, including:

  • petroleum products,
  • housing loan interests,
  • electricity,
  • water,
  • essential food items, including wheat flour,
  • oil firms,
  • housing banks,
  • power producers,
  • flour mills,
  • and poultry feed manufacturers.

Times of Oman also noted the following:

Providing details of projected post-tax subsidies for various products and services, the IMF study said the subsidy on petroleum products, which constitutes 60.11 per cent, has reached $4.37 billion, while natural gas and electricity subsidies are estimated at $2.46 billion and $0.43 billion, respectively, for this year.

The IMF also noted that the Sultanate’s subsidy, as a per cent of GDP, is estimated at 8.9 per cent – 5.36 per cent in the case of petroleum, 3.02 per cent for natural gas and 0.53 per cent for electricity.

As far as the per capita subsidy is concerned, the IMF reported that the country’s total per capita subsidy is estimated at $1,718.97 – $1,034.52 for petroleum products, $582.32 for natural gas and $102.13 for electricity.

Oman, with its rich energy sector experience, has been active also on the geopolitical scene trying to tighten relations with both developed and emerging Asia nations.

In June Emerging Equity reported the following:

Indonesia’s Energy and Mineral Resources Minister Sudirman Said said that Omani investors may invest up to $7 billion in oil and gas projects in the country, the Jakarta Globe reports.

According to the report, the minister says that a number of investors from Oman have expressed interests in developing oil and gas tanks, a refinery, and a petrochemical plant in Indonesia.

Also in June Oman signed an investment agreement with Japan. The objective of the agreement is to reduce the barriers to trade and investment between the two nations and allow Japan to increase investment in the Middle Eastern economy.

Some basic information about Oman, courtesy of Wikipedia.

Oman, officially the Sultanate of Oman, is an Arab country in the southeastern coast of the Arabian Peninsula. Holding a strategically important position at the mouth of the Persian Gulf, the nation is bordered by the United Arab Emirates to the northwest, Saudi Arabia to the west, and Yemen to the southwest, and shares marine borders with Iran and Pakistan. The coast is formed by the Arabian Sea on the southeast and the Gulf of Oman on the northeast. The Madha and Musandam exclaves are surrounded by the UAE on their land borders, with the Strait of Hormuz and Gulf of Oman forming Musandam’s coastal boundaries.


Sultanate of Oman

سلطنة عُمان
Salṭanat ʻUmān
Flag National emblem
Location of  Oman  (red)in the Arabian Peninsula  (light yellow)
Location of  Oman  (red)

in the Arabian Peninsula  (light yellow)

and largest city
23°36′N 58°33′E
Official languages Arabic
Religion Islam
Demonym Omani
Government Absolute monarchy
 – Sultan Qaboos bin Said al Said
 – Deputy Prime Minister Fahd bin Mahmoud al Said[1]
Legislature Parliament
 – Upper house Council of State (Majlis al-Dawla)
 – Lower house Consultative Assembly (Majlis al-Shura)
 – The Azd tribe migration Late 2nd century
 – Imamate established[2] 751
 – Total 309,501 km2 (70th)
119,498 sq mi
 – Water (%) negligible
 – 2014 estimate 3,219,775 (129th)
 – 2010 census 2,773,479
 – Density 13/km2 (216th)
34/sq mi
GDP (PPP) 2014 estimate
 – Total $163.627 billion
 – Per capita $44,062[5]
GDP (nominal) 2014 estimate
 – Total $80.539 billion
 – Per capita $21,687

Leave a Reply

Fill in your details below or click an icon to log in: Logo

You are commenting using your account. Log Out / Change )

Twitter picture

You are commenting using your Twitter account. Log Out / Change )

Facebook photo

You are commenting using your Facebook account. Log Out / Change )

Google+ photo

You are commenting using your Google+ account. Log Out / Change )

Connecting to %s

Follow Us On Social Media

Google Translate

Like Us On Facebook

Our Discussion Groups

Facebook Group
LinkedIn Group

Follow EMerging Equity on

Our Social Media Readers


Get every new post delivered to your Inbox.

Join 275 other followers

%d bloggers like this: