Oman's GDP Declines by 2.8% in Q4 2023 Amid Drop in Oil Activities

Oman's gross domestic product (GDP) at current prices declined by 2.8% to RO 41.837 billion in the fourth quarter of 2023 compared to the same period in 2022, according to data from the National Centre for Statistics and Information (NCSI). The decrease was primarily driven by an 11.9% drop in oil activities, which fell to RO 14.971 billion.

Crude oil activities declined by 14% to RO 12.788 billion, while natural gas activities saw a modest increase of 2.4% to RO 2.183 billion. In contrast, non-oil activities experienced growth, increasing by 1.7% to RO 28.153 billion in Q4 2023.

The total industrial activities recorded RO 7.7 billion, agriculture and fishing activities contributed RO 966 million, and service activities accounted for RO 19.4 billion. The construction sector made up 7% of the GDP, wholesale and retail trade contributed 8%, public administration and defense accounted for 9%, and other non-oil activities comprised 40%.

Why this matters: The decline in Oman's GDP, largely attributed to the decrease in oil activities, highlights the country's economic vulnerability to fluctuations in the global oil market. As Oman seeks to diversify its economy and reduce its reliance on oil revenues, the growth in non-oil activities becomes increasingly vital for the nation's long-term economic stability and development.

The NCSI data provides a comprehensive breakdown of Oman's economic performance in the fourth quarter of 2023, shedding light on the challenges faced by the oil sector and the promising growth in non-oil activities. As the country navigates the changing economic landscape, the government's efforts to encourage diversification and support non-oil sectors will play a critical role in shaping Oman's future economic prosperity.

Key Takeaways

• Oman's GDP declined 2.8% in Q4 2023 to RO 41.837 billion.
• Oil activities dropped 11.9% to RO 14.971 billion, while non-oil grew 1.7% to RO 28.153 billion.
• Crude oil activities fell 14% to RO 12.788 billion, but natural gas rose 2.4% to RO 2.183 billion.
• Industrial, agriculture, and service sectors contributed RO 7.7 billion, RO 966 million, and RO 19.4 billion, respectively.
• Oman's economic diversification is crucial to reduce reliance on volatile oil revenues.