Oman’s oil output to hit 1.1m bpd by 2027: S&P
Published: 04:04 PM,Apr 05,2025 | EDITED : 08:04 PM,Apr 05,2025
‘We project hydrocarbon growth to improve toward 2%-3% annually over the next few years’: S&P
MUSCAT: Oman’s oil production is projected to reach around 1.1 million barrels per day (bpd) by 2027, up from approximately 1 million bpd in 2024 — an increase partly driven by the recent decision of the OPEC+ alliance to roll back output cuts. According to leading international ratings agency S&P, the Sultanate’s hydrocarbon output is expected to grow incrementally at a rate of 2–3 per cent annually over the next couple of years.
“We forecast oil production to remain flat in 2025 and increase from 2026 following the OPEC+ decision to lift quotas, meaning hydrocarbon sector output will progressively increase toward 1.1 million barrels per day (mb/d) by 2027 from 1.0 mb/d in 2024,” said S&P in its recent outlook statement affirming Oman’s long-term sovereign credit rating at ‘BBB-’ with a Stable Outlook.
“Given ambitious targets to produce more than 1 million tonnes of green hydrogen annually by 2030, condensate and gas production is anticipated to increase, upheld by investment. We project hydrocarbon growth to improve toward 2%-3% annually over the next few years,” the agency further noted.
Earlier this week, Oman joined seven other fellow producers of the OPEC+ alliance in agreeing to roll-back their voluntary oil production cuts, starting in May. The move will add around 411,000 bpd of output to global supply, including a contribution of around 50,000 bpd from Oman.
Coming against a backdrop of new US trade tariffs and dampening oil demand trends, the anticipated rollbacks sent global crude prices plunging by around 6 per cent over the past week – the lowest in three years.
In a post on the implications of the voluntary output cuts for the Omani economy, Eng Amor al Matani, Oman’s State Council Member, noted that the Sultanate lost around $4.6 million per day in revenue due to reduced production in 2024. This amounts to a revenue loss totalling $1.67 billion over the year. But “thanks to prior reforms and still solid oil prices”, Oman recorded a fiscal surplus of RO 540 million ($1.4 billion) in 2024, he pointed out.
However, with oil production and exports set to rise, Oman’s projected deficit of RO 620 million could be significantly reduced — or even eliminated — according to Eng Al Matani.
“If Brent stabilises at around $70, Oman’s average export price might be slightly lower than 2024’s $81, but the volume will be higher. The Sultanate’s budget for 2025 had anticipated a deficit of about RO 620 million (approx. $1.6 billion), likely based on a conservative oil price assumption. With the current developments, the actual outcome could be better than that projection: the price, while lower than 2024, is still above budget assumption, and production is rising faster than expected. This means Oman’s fiscal position may improve relative to the budget plan. If oil averages near Oman’s fiscal breakeven (high $60s), the government could roughly balance its books or run only a minor deficit,” the State Council Member added.
“We forecast oil production to remain flat in 2025 and increase from 2026 following the OPEC+ decision to lift quotas, meaning hydrocarbon sector output will progressively increase toward 1.1 million barrels per day (mb/d) by 2027 from 1.0 mb/d in 2024,” said S&P in its recent outlook statement affirming Oman’s long-term sovereign credit rating at ‘BBB-’ with a Stable Outlook.
“Given ambitious targets to produce more than 1 million tonnes of green hydrogen annually by 2030, condensate and gas production is anticipated to increase, upheld by investment. We project hydrocarbon growth to improve toward 2%-3% annually over the next few years,” the agency further noted.
Earlier this week, Oman joined seven other fellow producers of the OPEC+ alliance in agreeing to roll-back their voluntary oil production cuts, starting in May. The move will add around 411,000 bpd of output to global supply, including a contribution of around 50,000 bpd from Oman.
Coming against a backdrop of new US trade tariffs and dampening oil demand trends, the anticipated rollbacks sent global crude prices plunging by around 6 per cent over the past week – the lowest in three years.
In a post on the implications of the voluntary output cuts for the Omani economy, Eng Amor al Matani, Oman’s State Council Member, noted that the Sultanate lost around $4.6 million per day in revenue due to reduced production in 2024. This amounts to a revenue loss totalling $1.67 billion over the year. But “thanks to prior reforms and still solid oil prices”, Oman recorded a fiscal surplus of RO 540 million ($1.4 billion) in 2024, he pointed out.
However, with oil production and exports set to rise, Oman’s projected deficit of RO 620 million could be significantly reduced — or even eliminated — according to Eng Al Matani.
“If Brent stabilises at around $70, Oman’s average export price might be slightly lower than 2024’s $81, but the volume will be higher. The Sultanate’s budget for 2025 had anticipated a deficit of about RO 620 million (approx. $1.6 billion), likely based on a conservative oil price assumption. With the current developments, the actual outcome could be better than that projection: the price, while lower than 2024, is still above budget assumption, and production is rising faster than expected. This means Oman’s fiscal position may improve relative to the budget plan. If oil averages near Oman’s fiscal breakeven (high $60s), the government could roughly balance its books or run only a minor deficit,” the State Council Member added.