Estimated at $21.4 billion at the end of 2019, assets held by Oman’s largest sovereign wealth fund have decreased by about a third to $14.3 billion, according to updated data released by the Sovereign Wealth Fund Institute (SWFI) in the second half of April 2020. At the time of publication, Al-Monitor could not confirm the exact reason for this drop, expectedly related to budgetary support and losses in asset value.

Fitch Ratings recently indicated Oman could deplete the State General Reserve Fund (SGRF) by “over $5 billion” to finance budget deficits. “It is not really on the agenda, but everything moves very quickly,” a source familiar with the matter told Al-Monitor earlier this month. 

In the aftermath of the 2014 oil bust, Oman repeatedly tapped international debt markets to finance unprecedented budget deficits. Thus, its debt to GDP spiked to nearly 60% last year. Assets held by Oman’s sovereign wealth funds, in contrast, were largely safeguarded.

But the double shock caused by the coronavirus pandemic and plunging oil prices is leaving the indebted Gulf state with fewer options to finance its soaring 2020 annual budget deficit.