Muscat:The International Monetary Fund (IMF) staff mission has projected that the economic growth of the Sultanate of Oman will accelerate to 4.5 percent in 2026. This growth is expected to be driven by increased hydrocarbon activity and sustained nonhydrocarbon growth of 1.4 percent. The average inflation is anticipated to rise to around 3 percent in 2026 before gradually easing towards 2 percent over the medium term.
According to Oman News Agency, the IMF's projections were detailed in the concluding report of the IMF staff mission following the Article IV Consultation discussions with Oman. These discussions took place in Muscat from October 25 to November 8, 2026, as part of the annual consultations under Article IV of the IMF's agreement.
The IMF staff has noted the strength of Oman's financial position is expected to continue during 2026 and 2027, while maintaining fiscal discipline and allowing for investment to enhance resilience and economic diversification. The report highlights the resilience of Oman's economy amidst ongoing geopolitical developments in the Middle East, supported by stable energy infrastructure, strong logistics activity, sound economic fundamentals, and prudent policies.
The fiscal position of Oman is expected to remain robust, with the current account projected to achieve a surplus of around 6.5 percent of GDP in 2026 and maintain a positive trajectory over the medium term. The IMF emphasized the expansion of economic activity in Oman, driven by increased hydrocarbon production and sustained nonhydrocarbon growth, with real GDP expanding by 3.8 percent in the first half of 2026.
The IMF staff team also reported that fiscal and external balances remained in surplus during the first half of 2026, with a fiscal surplus of 1.9 percent of GDP and a current account surplus estimated at 3.7 percent of GDP. Government debt declined to 30.4 percent of GDP by the end of June 2026.
The IMF highlighted Oman's fiscal stance in 2026 as crucial in cushioning the impact of regional conflict while preserving fiscal prudence. Additional oil windfalls are expected to contribute to rebuilding fiscal buffers and creating space for investment in resilience and economic diversification. The statement also reaffirmed the appropriateness of the exchange rate peg as a credible policy anchor and noted the well-capitalized, liquid, and profitable state of the Omani banking sector.
The IMF staff team stressed the importance of accelerating economic transformation and strengthening resilience under Oman Vision 2040, emphasizing priorities such as improving economic resource allocation efficiency, advancing labor market reforms, strengthening trade integration with the GCC, and enhancing resilience to natural disasters.