Gulf to keep spending high in 2010 as oil prices up

Gulf Arab states are likely to keep their large spending packages in place next year, even as major economies withdraw stimulus, as higher oil prices give the world's top oil exporting region enough room to support a fragile recovery.

The global financial crisis slashed income for top Arab economies -- Saudi Arabia and the United Arab Emirates -- making them drain reserves as they embarked on massive spending plans to help emerge from this year's downturn.

But with oil prices more than doubling from last December's lows of around $32 a barrel, most Gulf governments expect to book budget and current account surpluses this year and are more upbeat about 2010.