Oman Returns to Capital Markets With Renewed Investor Confidence

The Sultanate of Oman returned to international capital markets with a sovereign sukuk issuance of RO 385 million ($1 billion) on the following terms: 7.5 years maturity, yield spread ( 60 basis points over US Treasury bonds), Annual coupon rate (4.525%).

The success of this issuance underscores Oman's enhanced position as a reliable issuer in global markets, based on increased international investor confidence in Oman’s ability to meet its financial obligations, according to the Quarterly bulletin issued by the Ministry of Finance.

The allocation of proceeds includes buying back a portion of Eurobands maturing in June 2026, totalling RO 117 million or $303 million at par value, and RO268 million or $697 million in partial repayment of international sukuk maturing in October 2025.

This issuance reflects the effectiveness of Oman’s medium-term public debt management strategy, focused on lowering debt servicing costs by leveraging favorable market conditions, reducing debt-related risks by diversifying financing sources, extending maturity profiles, and adopting a proactive approach to liability management and capitalizing on market opportunities.

Oman capitalized on the improvement in its credit profile following an upgrade to investment grade by global rating agencies, supported by enhanced financial resilience against economic shocks, improved economic growth indicators, and a lower public debt-to-GDP ratio.

The issuance drew strong demand from regional and international investors, as the orderbook exceeded four times the amount offered, a diversified investor base across regional and international markets, and investor confidence was reaffirmed in Oman’s strong fiscal position.

The positive impact includes the refinancing of a portion of maturing debt with instruments at competitive interest rates, reducing 2026 maturities by 12% through proactive management of government obligations, and mitigating debt portfolio risk by diversifying instruments and funding sources.