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Wed 3 Dec 2008 03:17 PM

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Oman cuts 2009 oil price forecast

Gulf state reduces prediction for next year's budget by $10 to $45 a barrel following tumble in crude prices.

Oman has reduced its assumed oil price for the 2009 budget by $10 to $45 a barrel following a plunge of around $100 in international crude prices since July. "The reduction in the forecast for the 2009 budget is to $45, it was previously $55," a government source told newswire Reuters on Wednesday. "This is due to the unexpected fall of oil prices. This forecast is more realistic." US crude has slumped to just over $47 a barrel on Wednesday from a peak over $147 in July. The slide has forced other oil-producing nations to cut their budget assumptions. Oman is a small producer pumping around 750,000 barrels per day (bpd), but its crude forms part of pricing benchmarks for around 12 million bpd of oil exported from the Middle East to Asia. Oman's crude trades at a discount of about $5 to the US crude. The Gulf Arab state is not a member of the Organisation of the Petroleum Exporting Countries (OPEC). Oman has said it has no plans to voluntarily reduce output to help OPEC's efforts to stop the slide in prices. Some OPEC members have called on independent producers to join in supply reductions. Oman's council for financial affairs and energy resources agreed at a meeting to amend the oil price assumption, the official news agency said on Wednesday. The new price assumption was unchanged from the previous year's budget, the government source said. If the price was above $45 next year, the additional revenue would strengthen Oman's reserves, he added. (Reuters)

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