Oman’s Producer Price Index (PPI) surged by 32.7 percent year-on-year in the second quarter of 2026, driven primarily by rising costs in the mining, quarrying, and manufacturing sectors, official data revealed.

According to the National Centre for Statistics and Information (NCSI), mining and quarrying prices rose 31 percent during the quarter, reflecting a 31.9 percent increase in crude oil and natural gas prices. This marked a notable reversal from the first quarter, when the PPI declined by 3.9 percent year-on-year amid an 11.3 percent drop in mining and quarrying prices. Crude oil and natural gas prices had fallen by 11.6 percent during that earlier period.

Within the mining sector, prices for stone and sand products edged up 0.5 percent, while metal ore prices fell 14.3 percent in the second quarter.

Manufacturing sectors experienced even sharper cost increases, with prices rising 40.3 percent overall. This was led by a 55.3 percent surge in prices for other transportable goods. Refined petroleum products recorded the most significant jump within manufacturing, rising 88.2 percent, followed by chemical products, which increased 21.4 percent.

Other notable increases were seen in metal products, machinery, and equipment prices, which rose 31.7 percent. Products made from iron, steel, or aluminum saw the largest gains in this group, with prices up 48.9 percent. Prices of power transformers, electricity distribution equipment, and cables also rose sharply, up 39.8 percent.

Food products, beverages, and textiles saw a more modest increase of 2.8 percent, with footwear prices rising 6.7 percent and woven fabrics up 2.8 percent. Utilities also became more expensive, with water prices climbing 44 percent and electricity prices rising 15 percent compared to the same quarter last year.

The rise in producer prices comes amid Oman's ongoing efforts to diversify its economy beyond hydrocarbons. Non-hydrocarbon activities now constitute nearly 70 percent of the country’s gross domestic product, although hydrocarbon revenues still account for approximately 80 percent of government income, leaving the fiscal position vulnerable to fluctuations in global oil prices, according to the International Monetary Fund.

In the energy sector, Oman’s refinery output decreased 3.7 percent year-on-year through July 2026, totaling around 129.4 million barrels. Diesel production fell 6.8 percent to 43.31 million barrels, down from 46.48 million barrels in the previous year. Total motor-fuel production declined 1.4 percent, while domestic diesel sales dropped 8.3 percent to 1.11 million barrels and exports fell 11.8 percent to 33.38 million barrels during the period.

These figures highlight the ongoing challenges Oman faces in balancing economic diversification goals with continued reliance on its hydrocarbon sector.