Oman Budget 2023: Key Highlights

16 January, 2023

Snapshot of the key features 

Oman budget 2023

Royal Decree No. 1/2023 was issued on 1 January 2023, and published in the Official Gazette dated 2 January 2023, promulgating the State’s Budget for the year 2023. Below are the key features of the 2023 budget :

Projected Revenue OMR 10.1 billion
Projected Expenditure OMR 11.4 billion
Projected Deficit OMR 1.3 billion
Projected income from the Oman Investment Authority ("OIA") OMR 0.8 billion
Projected investments by the OIA OMR 1.9 billion
Projected investments by Energy Development Oman
OMR 1.5 billion
Projected average oil price $55

Oman is projecting a fiscal deficit of OMR 1.3 billion in 2023, down by 16% on year-on-year budgeting, as growth in state spending is outpaced by a stronger growth in revenues on the back of projected higher oil and gas receipts. This is despite achieving a budget surplus of OMR 1.1 billion in 2022, which suggests that the Government remains conservative in its approach to growth and spending in the upcoming years.

Revenues and expenditures were estimated in line with Oman Vision 2040 and talking into account the medium-term fiscal plan (the 10th Five-Year Development Plan (2021-2025). The budget was prepared taking into account various factors such as the uncertainty facing global oil markets, global  inflation and the establishment of the Oman Energy Development Company and Integrated Gas Company. The latter has seemingly resulted in the transfer of spending on oil and gas production and transportation from Government spending to the private sector, as this line item has been removed from the spending budget for 2023.

Oil and gas revenues are forecasted at around OMR 6.7 billion, or 67% of overall receipts, down from OMR 7.2 billion from 2022, when it made up 68% of the total. Oman's projected revenue figures are based on an assumed oil price of $55 per barrel, up from an expectation of $50 per barrel in the 2022 budget. Again, the projected average oil price seems to be on a conservative basis considering that the current oil prices are relatively higher and the actual average oil price per barrel for Oman Crude of $94 per barrel in 2022. 

The reduction of 5% in total revenue in 2023 compared to the 2022 estimates is due to an expected reduction in oil and gas revenues, as well as in taxes and fees, and capital repayments. This is largely as a result of the restructuring of assets from the Government to the private sector, as well as the continuation of reliefs from the Economic Stimulus Plan incentives, and a revision of government fees.

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