Oman raises $2.5 billion in bonds to meet deficit ---AFP

Omani Qaboos bin Said Al Said, Sultan of Oman

Oman has raised $2.5 billion in a bond sale arranged by five international banks to help meet its budget deficit resulting from low oil prices, the finance ministry said Saturday.

The ministry, quoted by the Oman News Agency, said the sultanate’s first international bond issue in two decades was oversubscribed by almost three times.

The Gulf state sold $1 billion in bonds to mature in five years at an interest rate of 3.625 percent and a 10-year issue worth $1.5 billion at 4.75 percent, it said in a statement.

Oman is projecting a budget deficit of $8.6 billion this year after posting a shortfall of $11.7 billion in 2015.

The sultanate has adopted measures to cut spending and raise revenues that include reducing subsidies on fuel and electricity.

A non-OPEC producer, Oman is pumping around 1 million barrels per day.

Oil-dependent Gulf states, including OPEC kingpin Saudi Arabia, have been hit hard by a cash crunch due to a 60-percent drop in oil prices in the past two years.

Most of them have introduced austerity measures and turned to the bond market to raise finances.