GULF WEEKLY: Oman upgraded, Bahrain & Qatar see H1 surpluses, IMF proposes Saudi fiscal rules

GULF COUNTRIES - Report 19 Aug 2022 by Justin Alexander

A skimmable summary overlaid with our analysis and links. Headlines:

* Hopes grew that Iran and the US will compromise to restore the nuclear deal.
* Aramco achieved record profits but plans lower-than-expected capex this year.
* IMF Article IV praised Saudi policy but urged it to maintain the VAT rate and implement fiscal rules.
* PIF boosted stakes in US equities and bonds, while Prince Al Waleed invested in Russia.
* Dubai’s July inflation soared to 7.1%, while Saudi’s edged up to 2.7%, and Qatar’s fell to 5.0%.
* Qatar’s Q2 fiscal surplus rose to 17% of GDP despite a q/q drop in hydrocarbon revenue and strong spending growth.
* Kuwait’s current account surplus rose to about 39% of GDP in Q4.
* Kuwait appointed an ambassador to Iran for the first time since Gulf states broke ties in 2016.
* Oman reported strong June tourism numbers, up 7% m/m and close to 2019 levels.
* Fitch upgraded Oman to BB due to both higher oil prices and fiscal reforms.
* Bahrain achieved a rare fiscal surplus in H1, about 0.4% of GDP, with spending growth of just 2%.
* Egypt’s central bank governor resigned, likely signalling a move to more flexible FX rates.
* Databank updates: Bahrain & Qatar fiscal; Kuwait BoP; Dubai, Qatar, Saudi inflation; Saudi Art.IV.

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