Dubai: A modest recovery in oil prices falls short of filling budgetary gaps in crude-exporting Gulf countries, the International Monetary Fund said, stressing the need to cut spending.
The price of the region's main commodity has partially rebounded and is hovering around $50 per barrel having hit a 10-year low of less than $30 in January, from a peak of more than $100 in mid-2014.
The recovery "will definitely help in terms of the financial numbers for this year" for the countries of the Gulf Cooperation Council, said Masood Ahmed, the IMF's director for the Middle East.
"But it doesn't really change the fundamental outlook for GCC countries or the challenges that face them," he told AFP in an interview Tuesday.
Oil was expected to stabilise at around $60 per barrel in the medium term, he said, a rate lower than the budgetary breakeven point for some of the six nations.
In its regional economic outlook report released Wednesday, the IMF cited a breakeven price for Saudi Arabia, Qatar and the United Arab Emirates at $79.7, $62.1 and $58.6 respectively.
The level drops to $47.8 per barrel in the case of Kuwait, but it shoots to $77.5 and $93.8 in the case of Oman and Bahrain respectively.
"(This) means that GCC countries as a group still have to try and balance their budgets," said Ahmed.
GCC countries had to cut back their spending "one way or another" over the next five years and find ways of raising non-oil revenues, he said.
