Finance

Oman raises $130m from latest sale of treasury bills

June 3, 2025, 2:38 PM

The promenade at Muscat harbour. Analysts say Oman needs to do more to diversify its economy

Sale three times oversubscribed
Plan to raise $2bn from bonds
Oman also borrowing to tackle deficit

Oman has raised $130 million from treasury bills in a three-part sale that began on Monday.

The Central Bank of Oman sold $5 million, $52 million and $74 million of bonds with terms of three, six and 12 months, respectively. The coupon – or annual interest rate – is 5 percent.

By Tuesday the sale was oversubscribed more than three times, according to the Central Bank of Oman.

Sultan Al Habsi, the country’s finance minister, has told Oman Television that the government needs to raise nearly $2 billion from bond issues and borrow $6.4 billion to balance its books for 2025. Government debt stands at $37 billion.

Oman raised $340 million in bonds in May.

It also raised rial-denominated bonds and sukuk totalling $2.6 billion that will mature before the end of 2026, according to S&P Global. The country has $2.4 billion in dollar-denominated bonds maturing in June 2026.

Oman posted a deficit of $352 million for the first three months of 2025, which is 16 percent lower than the deficit in Q1 last year.

Analysts say Oman needs to accelerate economic growth from non-oil sources.

“Oil and gas incomes are not enough to keep the government’s economy afloat. It needs to diversify urgently to other resources like minerals and tourism to balance the fiscal budget instead of resorting to debts,” Khalifa Jaidi, a retired financial adviser with Al Omaniya Financial Company, told AGBI.

Oman forecast a fiscal deficit of $1.6 billion for its 2025 budget, from $1.7 billion last year. It posted a surplus of $1.4 billion in 2024 as it sold oil at an average price of $82 per barrel.

As part of its Vision 2040 strategy, Oman is aiming to build its tourism industry to attract 11 million visitors a year. It had 3.9 million tourists last year.

Oman has 14 mining concessions across the country and has found almost 500,000 tonnes of chromite, 111 million tonnes of high-purity silica and 242 million tonnes of dolomite.