Fuel support bill hits RO 162m, 4.6 times annual budget

MUSCAT: Oman spent RO 162 million supporting petroleum product prices in the first half of 2026 — roughly 4.6 times the RO 35 million allocated for the full year — according to an analysis of the Ministry of Finance's second-quarter fiscal bulletin by audit and advisory firm Nexia AMB.
Almost all of it arose in the second quarter. The fuel support line stood at RO 17 million at the end of March and reached RO 162 million by the end of June, implying about RO 145 million over three months as crude traded well above the budget assumption while domestic pump prices were held steady.
The figure sits inside an otherwise near-balanced half-year. Public revenue reached RO 6.602 billion and spending RO 6.619 billion in the six months to June 30, leaving a deficit of RO 17 million against RO 259 million in the same period of 2025.
Revenue ran at 58 per cent of the annual estimate and spending at 55 per cent. The approved 2026 budget anticipates a full-year deficit of RO 530 million. The Ministry labels the 2026 figures preliminary.
The realised average oil price for the half was $74 a barrel, against the $60 assumed in the budget — but slightly below the roughly $75 realised in the first half of 2025. Net oil revenue nonetheless rose 10 per cent to RO 3.332 billion, meaning the increase came from factors other than price, which the bulletin does not itemise.
Nexia also flags a timing effect. Oil revenue is recognised only after sale, delivery and collection are complete, so receipts lag market prices by some months. Brent reached $138.21 a barrel on April 7 before ending June at $70.46, and part of the fiscal effect of that spike may therefore surface in second-half receipts.
The outlook has moved since the bulletin was published on August 23. Nexia cites the US Energy Information Administration's September Short-Term Energy Outlook, issued on September 9, which raised the Brent forecast to about $91 for 2026 and $74 for 2027, from $81.91 and $64.76 in the July edition the Ministry had used. Both paths sit above the $60 budget assumption, though the margin narrows through 2027.
Gas was the strongest revenue line, up 32 per cent to RO 1,164 million. Oil and gas together generated about 68 per cent of public revenue in the first half, against about 67 per cent a year earlier. Current revenue, including taxes and fees, grew 6 per cent to RO 2,045 million.
On spending, ministries and government units disbursed RO 798 million in development expenditure, up 16 per cent and equal to 61 per cent of the RO 1,300 million allocated for the year. Of that, RO 146 million went to economic transformation projects — 37 per cent of the RO 400 million line introduced under the 11th Five-Year Development Plan. Disbursement reflects past commitments and milestones and does not by itself signal new tenders, the firm cautions.
Public debt stood at RO 14.16 billion at the end of June, up 0.3 per cent year on year but below the approximately RO 14.6 billion recorded at end-2025. The Ministry has committed to using any additional oil revenue to cover the deficit and reduce debt.