OPEC member Kuwait is headed for its 14th consecutive year of budget surplus thanks to strong oil prices and high production, an economic report said on Sunday.
The oil-rich Gulf state is expected to post a surplus of between 9.8 billion dinars ($34.8 billion) and 12.8 billion dinars ($45.4 billion) in the current 2012/2013 fiscal year, the National Bank of Kuwait said.
The projections were based on an average oil price of between $104 and $107 a barrel for Kuwaiti crude, the NBK report said.
Kuwait had projected a huge deficit of $26 billion for the current fiscal year ending on March 31, 2013, by calculating oil income at a highly conservative price of just $65 a barrel.
The emirate is pumping around 3.0 million barrels per day and plans to spend around $100 billion over the next five years on huge oil projects.
In the previous 2011/2012 fiscal year, Kuwait posted a record budget surplus of $47 billion on the back of an all-time high income of $107.5 billion. Oil revenue makes up around 95 percent of public revenue.
Kuwait has projected a deficit in each of the past 13 fiscal years, but ended in surplus mainly by projecting oil income very conservatively.
During that period, the emirate has accumulated about $250 billion in budget surpluses.
Under Kuwaiti law, 10 percent of revenues are deducted every year in favour of the emirate's sovereign wealth fund, the assets of which are estimated at about $400 billion.
This fiscal year, Kuwait decided to transfer 25 percent of revenues into the sovereign wealth fund. Returns on the fund are not included in the budget.
With a native population of 1.2 million in addition to 2.6 million foreigners, Kuwait says it holds 10 percent of global crude oil reserves.