MUSCAT: Capital Intelligence Ratings, an a international credit rating agency, has upgraded the Sultanate of Oman’s long-term foreign exchange rating at BB, as well as the long-term local currency rating with a stable outlook.
In its latest report Capital Intelligence stated that these ratings reflect the decline in government debt, in addition to the improvement in financial and external strength, as a result of the rise in hydrocarbon revenue and exports.
“The financial strength of the Sultanate of Oman is moderate, with the return of the government’s budget position to the surplus, due to the rise in international hydrocarbon prices,” said the report.
During the first six months of 2022, the government’s budget recorded a surplus of 1.9% of GDP, compared to a deficit of 3.4% during the same period in 2021, and it is on its way to reach 5.6% in 2022.
Capital Intelligence’s baseline scenario assumes that hydrocarbon prices will remain high throughout 2023-2024, averaging $80 per barrel, exceeding the budgeted average fiscal break-even oil price of $68 per barrel and predicted a budget surplus of 5.9% in the next two years.