Sharp spending cuts and rising oil prices are combining to slash Oman’s projected budget deficit by 45% to OR3bn in 2017. A conservative oil price estimate means this could fall further to around OR1bn.

Oman has announced an austerity budget for 2017 slashing its fiscal deficit by 44% in real terms to OR3bn ($7.8bn at OR1=$2.60) from a forecast of actual OR5.29bn deficit in 2016.

The Oman Ministry of Finance said in a statement on the 2017 budget issued by Royal Decree on 1 January...