Kuwait is set to register another record budget surplus during the current 2012-2013 fiscal year mainly due to the strong oil prices combined with lower spending, said a report.

However, the budget will be lower than the previous year's surplus, the Kuwait Times reported citing data from National Bank of Kuwait (NBK).

NBK said the recently approved, and much delayed, budget for FY2012/13 showed a nine per cent budget-on-budget increase in planned spending to KD 21.2 billion (Dh285 billion), as well as oil revenues based on a conservative average price assumption.

“If as we expect, spending comes in at 5-10 per cent below the government’s forecast and oil revenues much higher, the budget could ultimately see a surplus of between KD 9.8 billion and KD 12.8 billion before allocations to the Reserve Fund for Future Generations (RFFG),” NBK said in a study.

It said the projected surplus would be around 20-26 per cent of GDP, compared to the 30 per cent recorded last year.

The report showed high oil prices could sharply boost Kuwait’s actual crude export earnings to nearly KD30.2 billion in the high price scenario.

This will push overall revenue to around KD31.8 billion, more than twice the budgeted revenue of nearly KD13.9 billion, the report said, citing NBK data.

Kuwait, a major Opec producer, has recorded large fiscal surpluses over the past decade due to strong oil prices and spending curbs. The surplus was in contrast with fiscal situation during the 1990s, when the emirate suffered from huge shortfalls because of low crude prices and war costs, it added.