Consumer spending in non-Opec oil exporter Oman will slow further if oil prices fall below $45 a barrel long-term, and sales on luxury goods are already grinding to a halt, a leading Omani retailer said.

Nailesh Khimji, director of Khimji Ramdas -- which owns the largest supermarket chain in the sultanate -- expects his firm's growth in sales and revenues could slow to zero this year having enjoyed double digit growth in the past six years.

Oil prices -- the main source of revenues in Oman -- have fallen more than $100 a barrel since the July peak to around $47 as evidence of a global economic slowdown hits energy demand.

Independent firm Khimji Ramdas represents and distributes in Oman over 100 leading global brands such as P&G, 3M, Siemens and Benetton as well as Chanel and Rolex.

'We can gauge the mood of consumers. Consumers are holding back their expenditure, looking at the world economy and the morale of the people,' Khimji told Reuters in an interview ahead of the World Economic Forum which starts on Wednesday.

'If oil falls below $45 government spending will stop and consumer spending will slow.'    

Oman has based its 2009 budget on oil prices at $45 a barrel and the government has said it would cut public spending this year if the average oil price fell below this level.

Khimji said Omani consumers were still buying day-to-day products, but have cut back on luxury items, especially watches.

'You will not stop buying shampoo or (baby diapers) pampers -- that's bread and butter. You can't live without it,' Khimji said.

'On luxury goods, people are waiting and watching. They're tightening their belts. The watch industry is in dire straights worldwide. The world has been hit in that sense.'    

Khimji Ramdas, which also engages in building materials, oil, gas, shipping and logistics activity, saw its sales and revenues rise 50 percent in 2008 from the year before and profit ballooned by 100 percent on the year.

'(Oman) came in late into the boom and the boom has since ended. So we will not feel the recession as such. We will not have empty apartments like our neighbours, dumping them below the cost,' he said. - Reuters