Oman to Sell $2b of Bonds Amid Deficit

Oman, the largest Arab oil producer and a non-OPEC member, plans to sell between $1.5 billion to $2 billion of bonds internationally in 2017 to plug a deficit caused by low crude prices.

“There’s an appetite still and I think even when interest rates are raised there will still be appetite,” Ali Hamdan Al-Raisi, vice president for banking oversight at Oman’s Central Bank, said in an interview at an event in Abu Dhabi on Wednesday. The size and exact timing hasn’t yet been finalized, he said, Bloomberg reported.

The sultanate sold $2.5 billion worth of bonds in June in its first such sale since 1997 and tapped the bonds for an additional $1.5 billion in September. The country also raised $1 billion from the international loan market in January to help bolster its finances.

Oman joins several other governments and companies from the six-nation (Persian) Gulf Corporation Council (Saudi Arabia, Kuwait, the United Arab Emirates, Qatar, Bahrain, and Oman) tapping the bond markets as they cope with low oil prices. The region is home to about a third of global crude reserves.

Saudi Arabia sold $17.5 billion in bonds in a three-part bond sale in October, Qatar, the world’s biggest liquefied natural gas exporter, raised $9 billion this year while Abu Dhabi raised $5 billion in April.

Oman’s budget deficit widened 55% year-on-year in September to 180.5 million rials ($468.83 million). The country plans to raise 600 million riyals in local debt next year, Al-Raisi said.