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Wed 19 Aug 2015 02:01 PM

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Oman posts near-$5bn deficit in H1 as cheap oil bites

Provisional Finance Ministry data reveals half yearly deficit compared to surplus in H1 2014

Oman posts near-$5bn deficit in H1 as cheap oil bites

Oman posted a budget deficit of OR1.92 billion ($4.98 billion) in the first half of this year against a OR250 million surplus a year earlier, because of lower oil export prices, provisional Finance Ministry data showed on Wednesday.

Oman's 2015 budget plan envisages government expenditure of OR14.1 billion and a deficit of OR2.5 billion, assuming an average oil price of $75 per barrel, said the data which was cited by Reuters.

The plunge of crude prices is a serious blow to Oman, which lacks the ample fiscal and hydrocarbon reserves of its wealthier Gulf neighbours.

In April, the World Bank estimated the decline in crude prices could cost the Gulf Cooperation Council (GCC) countries - Saudi Arabia, Kuwait, the United Arab Emirates (UAE), Qatar, Oman and Bahrain - $215 billion, or 14 percent of their combined gross domestic product this year.

Consequently, the region may record a fiscal deficit for the first time in four years, it said.