KUWAIT CITY, 2 November 2003 — OPEC member Kuwait has earned from oil in the first seven months of the 2003-04 fiscal year more than budget projections for the whole year, an independent economic report said yesterday.

The Al-Shall Economic Consultants said the emirate is estimated to have collected 3.2 billion dinars ($10.7 billion) from April 1, when the fiscal year begins, to the end of October.

Oil revenues were projected at 2.970 billion dinars ($9.9 billion) on the basis of a price of $15 a barrel and production of around two million barrels per day (bpd).

But the average price for Kuwaiti oil during the first seven months of the fiscal year was 25.90 dollars a barrel, more than 72 percent higher than the budgeted price, Al-Shall said.

The price of Kuwaiti oil consolidated during October to an average of $27.45 a barrel compared to $25.6 a barrel in the first six months of the year.

Kuwait is scheduled to reduce its daily output as of yesterday from 2.038 million barrels to 1.966 million barrels in accordance with a decision by OPEC ministers to cut production by 900,000 barrels a day from Nov. 1.

The emirate’s Energy Minister Sheikh Ahmad Fahd Al-Sabah said last week Kuwait will abide by the decision of the Organization of Petroleum Exporting Countries despite soaring oil prices.

Kuwait has estimated total public revenues for the current year, which ends on March 31, 2004, at 3.555 billion dinars ($11.85 billion).

The budget also projected a $7.56 billion shortfall, while expenditures were estimated at 5.824 billion dinars ($19.41 billion).

By law, 10 percent of revenues, in this case 355.49 million dinars ($1.2 billion), is deducted for the Kuwait Fund for Future Generations, a $70-billion investment managed by Kuwait Investment Authority.

The preliminary figures about better-than-expected revenues raised hopes that the emirate will wipe out the projected deficit and may boast a surplus as it did over the past few years.

Al-Shall warned, however, that the expected surplus will diminish if capital losses of Kuwait’s overseas assets in the past few years and a drop in the value of the US dollar are taken into account.