Kuwait oil revenues to hit KD 27bn

Kuwait oil revenues are expected to reach KD 27 billion in the fiscal year 2013/2014, Al Shall Economic Consultants Company's Economic Research Unit said in a report released Saturday. "Kuwait is supposed to have achieved oil revenues during the past two months of the new fiscal year in the amount of about KD 4.5 billion," reads the report. "Assuming production levels and prices would continue at their present level, an assumption which is unrealistic on the price side at least, and perhaps the current production, too, projected oil revenues would score about KD 27 billion for the entire current fiscal year, which is KD 10.1 billion above the budget estimate." The report also pointed out that total budget revenues are expected to KD 28.2 in the corresponding period. "Adding KD 1.2 billion in non-oil revenues, total budget revenues for the current fiscal year would score about KD 28.2 billion." Comparing this figure with expenditures allocations figure in the amount of KD 21.2 billion, the outcome will be a hypothetical surplus by about KD 7 billion for the entire fiscal year 2013/2014. The report showed that the oil market is subject to pressures on prices and it needs to maintain a reasonable level by voluntary cuts especially from Kuwait and Saudi Arabia because they produce beyond their OPEC quota. "The market is also exposed to pressure on the demand side due to a general and long-term weakness in the global economic growth. Likewise, it is under pressure from the supply side due to the increase in producing difficult and nonconventional oils. "Prices are supported by the political risk premium as well as the sanctions against Iran. Nevertheless, there seems to be no changes in our financial policy for early handling of the weak oil market. On the contrary, generosity of popular proposals is escalating; besides, the oil sector lost last week its first professional oil minister ever. With regard to the stock market, the report noted that the performance of Kuwait Stock Exchange (KSE) for the last week was mixed where the traded volume index and the number of transactions decline, while the traded value index and the general index increased. "AlShall Index (value weighted) closed at 475.3 points at the closing of last Thursday, showing an increase of 8.3 points or about 1.8 percent compared to the end of the previous week, and an increase of 37.1 points or about 8.5 percent compared to the end of 2012."