(Adds more quotes, S&P report)
By Dahlia Nehme
DUBAI, April 2 (Reuters) - Oman welcomes a U.S. invitation
to OPEC members to discuss ways of halting a collapse in oil
prices, the country's oil minister said, according to the Omani
al-Watan newspaper on Thursday.
Oman is not in the Organization of the Petroleum Exporting
Countries, but is a member of the OPEC+ alliance of OPEC and
non-OPEC nations that struck an oil output deal that had led to
relatively stable oil prices since 2017.
The agreement collapsed last month after Russia refused to
support deeper production cuts to support prices hit by the
coronavirus outbreak.
In response, OPEC's de facto leader Saudi Arabia slashed its
export prices and said it would raise production to maximum
capacity.
U.S. President Donald Trump said on Wednesday he had spoken
to the leaders of both Saudi Arabia and Russia and believed the
two countries would reach a deal to end their price war within a
few days. "The invitation addressed by the United States ... to main
OPEC member countries to return to negotiations may rekindle
hopes of reaching practical solutions to controlling the oil
price decline," Omani oil minister Mohammed bin Hamad al-Rumhy
said, according to al-Watan.
"We don't support countries in increasing production at this
sensitive stage, as it doesn't serve the global oil industry nor
the states' interests."
"The oil market is going through a critical stage and the
economical and financial losses, especially for countries
dependent on oil revenues, will be large if prices remain where
they are now," he added, ruling out the possibility of price
drop to about $15 per barrel.
International crude prices LCOc1 have fallen by around 50%
to below $26 a barrel since the OPEC+ output deal collapsed.
Al-Rumhy announced ambitious plans late last year to invest
more than $20 billion in downstream operations in the next five
years. However, the impact of current economic conditions will
put on hold any investments in new fields and projects, he was
reported as saying on Thursday.
The sharp drop in oil prices in 2020 will intensify Oman's
fiscal and external pressures, leading to a faster deterioration
in the government's balance sheet, S&P Global Ratings said in
its most recent report.
Oman will face a trade imbalance due to lower oil prices and
has limited fiscal space to adjust gradually, according to S&P,
as hydrocarbon products comprise about 35% of GDP, 60% of
current account receipts, and 75% of fiscal receipts.