Japan's MUFG expects deep recession across GCC countries - Reuters

Japan's MUFG expects deep recession across GCC countries - Reuters:

Japan’s Mitsubishi UFJ Financial Group Inc (MUFG) (8306.T) expects countries in the six-nation Gulf Cooperation Council (GCC) to be in deep recession this year with overall real GDP contracting 3.7% from a previous growth forecast of 2.9%.

The bank said in a research note on Monday the new forecast took into account oil output cuts, the impact of the new coronavirus on the non-oil economies of the region, and the stimulus provided by GCC governments.

MUFG estimates the drop in oil prices costs the six nations - Saudi Arabia, the United Arab Emirates, Kuwait, Qatar, Bahrain and Oman - some $72 billion in overall lost oil export receipts for each $10 a barrel drop, and said it expects overall GCC financing requirements of $208 billion this year assuming an average Brent price of $43 per barrel.

“The GCC region continues to grapple with two ultra-bearish shocks – demand-side destruction caused by COVID-19 and supply-side challenges caused by the oil price collapse,” it said.