Few of the oil-producing countries of the Persian Gulf were hit so hard and fast by plunging petroleum prices as Oman. And few reacted as quickly in trying to bring their economies into line with the new realities.

In late January, Oman devalued its currency, the rial, by 10 percent and cut the budgets of all its ministries by the same amount.

Yet it is now clear that these measures will not begin to be adequate, and the recent story of Oman's economy -- fiscally conservative, free-market and supervised by an international array of experts -- stands as a good example of just how unpredictable the region's finances have become.

With only a handful of exceptions, the government of Sultan Qaboos bin Said has been careful throughout his 15 years in power to avoid the extravagances of other oil kingdoms. The emphasis has been on carefully planned development rather than showpiece construction.

The Defense Ministry, a sacred cow in many countries, was the first to feel the knife here when cuts became mandatory in January. Delivery on an order for eight British Tornado jet fighters costing more than $250 million was postponed until 1991 or later, according to government officials.

Several western diplomats said they saw this as a quick demonstration that Oman was serious about avoiding major debts at a time of continuing economic uncertainty.

"We developed quite late, and we learn from other people's mistakes," said Fauzia H. Kindy, director of research at the Central Bank of Oman. "Considering the circumstances, we're doing quite well." But she added, "Your guess is as good as mine as to what is next."

According to official statistics, oil revenues form 92 percent of foreign exchange earnings and about half of the gross domestic product.

Development only began in earnest here in 1970, after Qaboos deposed his father, and the growth rate during the oil boom that followed was predictably spectacular.

Oman implemented its first two five-year plans with considerable success. Even last year, according to Sherif Lotfy, one of the sultan's economic advisers, the growth rate was about 11 percent.

But a year ago, Omani oil was selling for $27 a barrel. Now the price is half that.

Since the beginning of this year Lotfy and other economists have been trying to put together a new five-year plan while riding the oil price roller coaster, and the car has been rushing nowhere but down.

Initial planning in 1985 had assumed a gradual price decline to an average of about $23.65 a barrel through 1990. At that, an average 4 percent growth rate was expected.

"But that is history now," said Lotfy. No one in the government wants to guess publicly at this point how much the economy will shrink.

Last fall the planners had imagined the possibility of a price war. But it was thought the price would not drop below $18.

As the plunge began, the budget cuts and devaluation in January were based on the expectation that after a drop, prices would stabilize near $20 over the next five years.

Then, within days, new contingencies had to be drawn up for $14, $12 and even less.

Now prices have become so unpredictable that Lotfy, Kindi and others say they simply do not know what they will do beyond certain broad guidelines giving development priority over the more backward sectors of society.

Lotfy said he doubts that another devaluation will be necessary, but added that that question may have to be reassessed later in the year.

Unlike Kuwait or Saudi Arabia, which began making their oil billions decades ago, Oman did not have any lucrative oil concessions until the late 1960s.

Now Kuwait can rely on its enormous foreign investments to take up some of the slack in oil prices. Without pumping a drop of petroleum in 1986, its economists believe Kuwait could expect about $5 billion in revenues from interests in such companies as Mercedes-Benz.

Oman does not have such substantial foreign investments. Most of its money was spent here.

Both the Kuwaitis and Saudis have enormous reserves and pumping capacities, moreover, so they can -- if they choose -- produce more and more oil to compensate for lower prices.

Oman does not have that luxury, either. At roughly 550,000 barrels a day, Oman is currently producing about as much oil as it can, according to diplomats and other foreign economic analysts.

As one result, Oman took a new interest in coordinating its production and pricing strategies with the Organization of Petroleum Exporting Countries. Although not a member, it was quick to send a delegation to meet with OPEC producers in Geneva last month.

Despite its vulnerabilities, Oman has some economic cushions to keep the average Omani from feeling the pinch very severely.

Non-Omanis are the ones who first get squeezed. The country is full of expatriate laborers, from ditch-diggers to armed forces officers. Their ranks already are being cut.

According to the Middle East Economic Digest, about 50,000 to 60,000 of a total 200,000 foreign workers are expected to leave by the end of August.

Devaluation also will make luxury imports more expensive.

Putting things in Oman's still relatively luxurious perspective, Lotfy noted that "it's a free economy. When people have money they buy a third television, a fourth car." When "times are tough," he concluded, they do not.