The price of Omani oil crossed $69 per barrel for the first time in three years.
The price of oil for Oman’s June 2018 delivery rose to $69.08 per barrel compared to $68.66 the day before, recording a rise was 46 cents in a single day—the largest price per barrel since the recent oil glut began in 2015, according to the Dubai Mercantile Exchange (DME).
“I think this will have a very positive impact on the economy from two counts. One is of course, the revenue from the government will certainly get a boost which will in turn lead to better management of the country’s fiscal deficit. At $45 a barrel is the price that Oman’s fiscal budget for 2018 was prepared and in that, there is a OMR3 billion. So, a significant increase in the price of oil is going to have a very positive impact on the country,” said Alkesh Joshi, a Partner at professional services firm Ernest & Young Oman, reported by the Times of Oman.
The recent estimates by the International Monetary Fund (IMF) that the deficit to gross domestic product ratio is at 11 per cent for 2018, though with oil at $69.08 per barrel level, this ratio will be reduced.
According to the Times of Oman report, the predicted increase in oil prices and the expansion of the non-oil economy will improve the macroeconomic outlook, the fundamentals are strong, and as global supply dips and demand increases, there is a synchronised rebound in the oil market. This will result in the private sector once again investing in oil and gas projects, and liquidity will slowly creep back in to the market. The prices of oil show that we should be geared up and ready for an upbeat in the economy very shortly.