Oil Price: As Nigeria Struggles, Oman Posts $1.7bn Budget Surplus in H1

Emmanuel Addeh in Abuja

Oman has posted a budget surplus of $1.71 billion (656 million rials) at the end of the first half of 2023, compared with 784 million rials in the same period in 2022, the state news agency has reported.

But despite its huge oil and gas reserves, Nigeria has been unable to take advantage of the high crude oil prices that have prevailed for over a year. The country which has embarked on massive borrowing, blames oil theft for its persistent failure to perform.

Although billions of naira is spent to mobilise federal security agencies and since last year, local security groups in the Niger Delta, to stop the menace, there has only been a marginal improvement since the last quarter of last year.

Although production rose about 900,000 bpd to 1.3 million bpd in the initial months that followed, the little gains are now being eroded as output fell to roughly 1 million bpd in July.

Oman approved a 2023 budget with a deficit of 1.3 billion rials, or 3 per cent of Gross Domestic Product (GDP), after posting a surplus of nearly $3 billion last year.

Gulf oil producers last year benefited from a sharp rise in oil prices, which surged past $100 a barrel after Russia’s invasion of Ukraine exacerbated concerns about disruptions to global energy supply.

A Reuters report said that the budget for this year is based on an average oil price of $55 a barrel. The 2022 budget was based on an oil price assumption of $50 a barrel, but the government later estimated prices averaged $94 a barrel last year.

In Nigeria, the oil budget was based on an oil price of $75 while projected production was 1.69 million barrels per day. The country has failed to reach that forecast this year.