Oman’s crude oil production is projected to rise 9.8% to 1.1 million barrels per day (bpd) in 2022, drastically reducing the country’s current account deficit to 0.2% of GDP for the year, according to Fitch Solutions report.

“Bright prospects for oil prices and Omani production will be the main driver of a continued widening of the surplus in the trade in goods balance in 2022,” Fitch Solutions Group (FSG), an affiliate of Fitch Ratings, has stated.

The output increase comes as the OPEC+ alliance, of which Oman is a signatory, begins a rollback of production quotas adopted at the start of 2020 to shore up collapsing international oil prices. Oil production averaged 957K bpd in 2021, and is projected to rise to an average of 1,055K bpd in 2022, per the latest general budget for the year.

Meanwhile, natural gas production is expected to increase 4% to 39.7 billion cubic metres, buoyed by new volumes from BP Oman’s Block 61 gas fields and the Mabrouk projects in central Oman.

Fitch Solutions forecast oil and gas exports will grow by 10.5% in 2022 to reach $18.2bn, the highest level since 2014 before oil prices crashed.

As a result of the growth in hydrocarbon output, coupled with the uptick in oil prices, Oman’s current account deficit is projected to decline to 0.2% of GDP in 2022, down from the estimated 0.8% shortfall in 2021. The corresponding figure for 2020 was a steep 12.6% of GDP.

With hydrocarbon exports accounting for around two-thirds of total exports, the size of Omani exports is projected to rise 7.9% to $43.2 billion in 2022, according to the market research think-tank.

Imports are anticipated to expand by 8.0% to reach $8.6bn in 2022, attributed to relatively robust real GDP growth, projected at 5.0% in 2022.