CAIRO: Oman’s Sultan ratified a 2023 budget with a deficit of 1.3 billion Omani rials ($3.38 billion) or 3% of GDP, the finance ministry said on Sunday, adding that the 2022 budget achieved a surplus of 1.146 rials.

The 2023 budget sees revenues of 10.05 billion Omani rials, 5% lower than 2022, and expenditures of 11.35 billion rials, 6.4% lower the previous year.

Higher oil prices boosted 2022 revenues to 14.234 billion rials, the finance ministry said. Last year’s budget had been based on a forecast price of $50 per barrel but the government now estimates the average price in 2022 to be $94.

The 2023 budget is based on a price of $55 per barrel.

Public spending in 2022 was 13.088 billion rials, the ministry said. The surplus allowed the government to reduce public debt from 20.8 billion rials in 2021 to 17.7 billion rials in 2022.

The International Monetary Fund (IMF) expects Oman, one of the Gulf’s weaker economies, to post fiscal and external surpluses over the medium term, due mainly to higher oil revenue, fiscal discipline and the introduction of value added tax.

Last month, S&P Global upgraded Oman’s credit rating to BB, from BB-, on improved fiscal performance and lower public debt.