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Omani Firms Cite Low Crude Price as Reason to Fire Expats

Oil Rig Onshore

Companies in Oman are dismissing expats, using the collapsing crude oil prices as an excuse, while neglecting to hire locals whom they find lacking in skills and experience, local media report.

The low oil prices are actually not directly impacting businesses, and firms are only using them as a pretext to fire employees, according to Mohammad Al Faraji, board member of the General Federation of Oman Trade Union (GFOTU) and head of the Committee on Rights and Obligations.

Local companies prefer to work with expats they can deport if they complain, Al Faraji said, adding that some firms refuse to comply with a government regulation for a fixed percentage of Omani employees, because they find it easier to take advantage of and exploit expats.

Oman, a non-OPEC oil producer, hit the headlines last week after its Minister of Oil and Gas, Mohammad bin Hamad al-Rumhy, said that the country would not take part in a meeting of oil producers and consumers in Algeria next month “as it is disappointed by the group's failure to address the issue of low oil prices”.

Al-Rumhy said Oman did not “see the point of continuing to be part” of the group.

The International Energy Forum, which groups producers and consumers, is slated to take place on September 26-28 in Algiers.

Oman pumped around 1 million barrels per day of petroleum and other liquids in 2015, most of which is bound for exports. Oman’s refusal to talk potential production freezes may also lie with its ambitions to increase oil production to meet domestic demand from new refining capacity coming online.

Al-Ruhmy has not only indicated that Oman would increase production by 70,000 - 90,000 bpd to accommodate the new capacity, but that it would export around 50,000 bpd less, and also look to import more.

By Tsvetana Paraskova for oIlprice.com

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