Kuwait income plunges over oil price slump

KUWAIT CITY, Kuwait—Kuwait’s revenues dropped by one fifth in the first 11 months of the fiscal year due to the decline in global oil prices, according to figures released by the finance ministry on Thursday.

Revenues of the Opec member reached 23.2 billion dinars ($77.3 billion) until the end of February from to 28.9 billion dinars in the same period last year—a fall of 19.7 percent.

The decline is mainly due to a 27.4 percent dive in oil revenues from 27 billion dinars last year to 21.2 billion dinars.

Oil income still represented 91.4 percent of total public income.

Oil lost around 60 percent of its value since June due to oversupply, with a strong dollar and a weak global economy dampening demand.

Price of Kuwaiti oil averaged well above $100 a barrel last fiscal year but is currently hovering around $50.

Kuwait’s fiscal year runs from April through March. Revenue figures for March have not yet been published.

Despite the sharp drop in revenues, the Gulf state posted a provisional budget surplus of 9.9 billion dinars and it is expected to end the year with a windfall for the 16th consecutive year.

Kuwait calculated the price of oil last fiscal year at $75 a barrel but reduced the figure to $45 a barrel in the current 2015/2016 fiscal year, which began on Wednesday.

As a result, the emirate is projecting a deficit of $24 billion.

Sustained surpluses since 2000 have boosted fiscal reserves of the country’s sovereign wealth fund to around $550 billion, according to unofficial estimates.