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Financing shortfall will push Oman to uneasy austerity

Thursday, January 28, 2021

Significance

A fiscal crunch exacerbated by the pandemic and associated oil-price crash has forced the authorities to step up long-term ‘Omanisation’ efforts, ultimately taking pressure off the bloated public sector wage bill. This comes as Sultan Haitham bin Tariq Al Said, one year into his reign, launches a raft of new political, military and economic initiatives.

Impacts

  • Oman will remain compliant with OPEC+ oil production cuts.
  • The sultanate will boost output at its competitive giant Ghazeer and Khazzan gas fields in Block 61 to benefit from high prices.
  • Muscat will prioritise agriculture, fisheries and logistics for non-oil growth but struggle to secure project financing post-pandemic.

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