Weak oil price will not affect Oman infrastructure projects

Muscat: The weak price of oil will not affect Oman’s planned infrastructure development projects, according to the country’s government, but could affect those in the future.

Budgets for existing construction projects will not be affected. The Sultanate has set aside billions of dollars to invest in massive construction projects to improve its transport systems and encourage tourism, but will cut spending in other areas to offset this investment.

Oman’s new national rail network is due to go ahead as scheduled. The first phase of the 1,000-km track linking Muscat to the UAE is expected to be completed by 2017.

The Sohar Industrial Port Company is interested in constructing a new port city project at Sohar Port at an approximate value of $12bn. At the time of writing, it was unclear if this project will be affected by the budget cuts.

Oman’s economy depends on high oil prices to balance its budget, which leaves the country vulnerable in times of price fluctuations.

Crude oil has fallen to roughly $85 a barrel but Oman needs $102 per barrel to break even in 2014, according to estimations made this year by the International Monetary Fund. [23/10/14]

 


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