KUWAIT CITY, 28 February 2008 — OPEC member Kuwait said yesterday it achieved revenues of 15.35 billion dinars ($56 billion) in the first 10 months of the current fiscal year, almost double budget estimates.
The figures issued by the Finance Ministry put the Gulf state on track for a ninth straight year of budget windfalls because of strong crude prices.
Revenue for the period to the end of January compares with projected income for all of 2007 2008 of 8.3 billion dinars (more than $30 billion) and is 15.4 percent up on the same period the previous year. Oil revenues jumped 14.3 percent to 14.4 billion dinars ($53 billion) over the 10 months and were almost double budget estimates of 7.45 billion dinars (more than $27 billion) for the year ending March 31, according to figures posted on the ministry’s website.
The figures reflect a sharp rise in the price of oil which contributes around 94 percent of total revenue in Kuwait, OPEC’s fourth largest producer.
Kuwait has adopted a conservative price of $36 a barrel in calculating oil revenues but the price of Kuwaiti oil has averaged around $75 a barrel so far this fiscal year.
And yesterday, crude prices surged to a record above $102 a barrel, energized by the weak US dollar and concerns that OPEC could cut output next week.
Kuwait said actual spending in the 10-month period was 5.8 billion dinars ($21 billion), well below a budget forecast for the full year of 11.3 billion dinars (more than $41 billion). This would leave an actual surplus of 9.55 billion dinars ($35 billion) for the 10 months, against a projected deficit of three billion dinars ($11 billion) for the whole fiscal year.
Meanwhile, Kuwaiti shares rallied yesterday past the 14,000-point barrier for the first time to set a new high on the back of abundant liquidity and a positive economic environment, traders said.
The Kuwait Stock Exchange (KSE) Index finished at 14,005.60 points, up 0.66 percent on last week’s close. The bourse was closed for three days for public holidays.
The index is now 11.5 percent higher than its 2007 close of 12,558.90.
Traders attributed the sharp rise to abundant liquidity from abroad, mostly from investors in neighboring countries in the Gulf.
Economic reports have also cited a number of economic laws passed by parliament in the past two months which included slashing income tax on profits of foreign investors to 15 percent.
They also said investors have been encouraged with corporate results, with 2007 profits of about 100 companies so far more than double the previous year.
