S&P Global Ratings could upgrade Oman’s sovereign grade for the first time since 2007 after improving its outlook to positive, following a fiscal turnaround that’s reducing the strain on its public finances.
While the sultanate’s spell in junk may be far from over, S&P’s change in the outlook from stable is a signal the firm is more inclined to raise the rating than cut it. S&P, the first of the major credit assessors to give Oman a non-investment grade, affirmed its long-term foreign currency rating at B+ on Friday, on par with Bahrain, Bolivia and Rwanda.
“Authorities have outlined a solid path to reduce the historically high fiscal deficits,” S&P credit analysts including Zahabia Gupta said in a report. “Economic and fiscal pressures on Oman are easing, as the effects of the sharp drop in oil prices in 2020 and the Covid-19 pandemic abate.”
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