Associated France Press (AFP) 7/1/2006
Kuwait to post 23-billion-dollar surplus
KUWAIT CITY (AFP) - Kuwait is expected to post a surplus of up to 23 billion dollars in the current fiscal year, National Bank of Kuwait said, revising downward its previous forecast of 26 billion dollars.
NBK made the revision after oil prices of the Kuwaiti crude eased slightly during the past four months.
The bank said in its latest economic report that Kuwaiti oil prices will range between 49.1 dollars a barrel and 49.9 dollars for the whole year, as compared to between 51.9 dollars and 54.8 dollars in its previous forecast.
Public revenue for the year, which runs from April 1, 2005 to March 31, 2006, is forecast at between 45 billion dollars and 46 billion dollars, NBK said.
Expenditure is expected to be around 23 billion dollars. This would leave a net surplus of between 22 and 23 billion dollars, the report said.
Despite the revision, the expected surplus will be an all-time record for OPEC-member Kuwait.
Oil revenues for the year are forecast at between 42.7 billion dollars and 43.6 billion dollars, around 94 percent of total income.
Kuwait’s budget for the current fiscal year projects expenditure at 24.7 billion dollars and revenues at 15.7 billion dollars, leaving a deficit of nine billion dollars.
The budget calculated oil income at a conservative price of 21 dollars a barrel and a daily production of two million barrels. Kuwait’s actual production has been around 2.5 million barrels per day (bpd).
In the first eight months of the fiscal year, Kuwait boasted actual revenues of 31.4 billion dollars, as compared to 20.5 billion dollars in the same period of the previous year, the finance ministry said.
Between fiscal years 1999/2000 to 2004/2005, Kuwait accumulated more than 30 billion dollars in budget surplus.
By law, 10 percent of total revenues is deducted in favour of the Kuwait Fund for Future Generations (KFFG), whose assets are estimated at around 100 billion dollars.
Returns on the Fund’s assets, estimated at around five billion dollars a year, do not figure in the budget.
Kuwait sits on 10 percent of the world’s proven oil reserves and has a native population of just 956,000.