Moody's: Low Oil Prices Increase Gulf Countries' Debt Accumulation
2019-03-15 - 7:18 p
Bahrain Mirror: Low oil prices increase the credit challenges of the Gulf Cooperation Council (GCC) states, especially Saudi Arabia, Kuwait, Oman and Bahrain, said Moody's credit ratings agency.
Moody's added in a report that oil prices in the Gulf countries will weaken their external financial situation and increase the accumulation of government debts faster than previously predicted.
"We expect oil prices to average $62 per barrel in 2019 and 2020, and down from the $71 per barrel average in 2018," said Alexander Perjessy, a Moody's Vice President - Senior Analyst and the report's author.
He continued that higher budgetary spending will support a modest acceleration in non-hydrocarbon growth in most countries, helping to cement popular support for ongoing gradual reforms and to curb increases in unemployment.
GCC countries rely on oil revenues to finance budget revenues.