Oman to hike fuel prices, taxes to face low oil price

Oman's government will hike fuel prices, charges for public services and corporate taxes in the face of falling oil prices, the official ONA agency reported Wednesday.

Non-OPEC Oman is the latest Gulf state to announce austerity plans amid falling oil revenues that have lead to big budget deficits.

"The council of ministers has approved a number of measures to face the consequences from the drop in oil prices and to ensure fiscal sustainability," ONA cited a cabinet statement as saying.

"These measures include reducing government spending and boosting non-oil revenues through raising taxes on corporate profits, increasing charges on some public services and amending fuel prices to be in line with international levels as from mid-January," the statement said.

The cabinet also approved a 2016-2020 development plan and the 2016 budget but provided no details.

Omani oil revenues have dropped by more than 60 percent as oil prices have plunged from about $100 a barrel to below $40 since mid-2014.

It has projected a budget deficit of $6.5 billion for 2015, but the International Monetary Fund has warned the shortfall may be much bigger.

Oman, a member of the energy-rich Gulf Cooperation Council (GCC), is a relatively small producer of crude, pumping about one million barrels per day.

Saudi Arabia on Monday announced massive hikes to the prices of fuel products, electricity, water and other utilities to face a growing budget deficit as oil revenues have dropped.

The United Arab Emirates earlier liberalised fuel prices and Kuwait and Bahrain have lifted subsidies on diesel and kerosene. Kuwait also plans to end subsidies on petrol soon.