Bahrain MPs push for price-linked boost to reserve fund from oil revenue
TDT | Manama
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Members of Parliament are proposing a price-based approach to channel oil revenue into the reserve fund, with them also securing the backing of Financial and Economic Affairs Committee, chaired by Ahmed Sabah Al Salloom.
The proposal suggests that for every barrel of oil priced between $40 and $60, one dollar should be added to the reserve fund. This amount would increase incrementally, reaching five dollars per barrel for prices exceeding $120. Al Salloom, has backed the proposal, calling it a crucial step to strengthen the Future Generation Reserve (FGR) and ensure Bahrain’s longterm financial stability.
MPs are also advocating for clear legal safeguards to ensure the funds are not diverted for other purposes without further legislative approval.
While the government supports the overall goal of the proposal, it has suggested several refinements to ensure the plan's practicality and sustainability. It recommended excluding oil derivatives from the deductions due to the complexity of pricing systems and the lack of clear definitions, which could complicate calculations. “Focusing on crude oil revenues ensures simplicity and effectiveness,” the government explained in its submission to Parliament.
Officials also proposed delaying the implementation until the next fiscal year, to allow for a smooth integration into Bahrain’s financial framework without disrupting current operations.
The Financial and Economic Affairs Committee held two meetings to review the proposal in detail, consulting with experts from the Ministry of Finance, the Future Generations Reserve Council, and the Ministry of Oil and Environment. These discussions helped refine the draft to ensure it aligns with Bahrain’s economic objectives while addressing technical concerns.
Ahmed Sabah Al Salloom described the revised law as a key step forward: “By tying deductions to oil prices, this proposal creates a dependable mechanism to grow the Reserve Fund, ensuring that resources are available for future generations while safeguarding Bahrain’s financial needs today,” he said.
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