Moody's put the Gulf countries on review toward downgraded

March 5, 2016 18:16
Hits: 18

DUBAI (AFP) - Moody's Investors Service lowered the credit rating classification of Bahrain and Oman, and put the rest of the oil-exporting Gulf states on the checklist toward downgraded on the back of falling oil prices, which weakened their economies.
The foundation said in a statement released late Friday that the decision "reflects the continuing impact of the large drop in oil prices."
Saudi Arabia include the review, which has reduced the Standard & Poor's rated two notches to "negative er" last month, the UAE, Kuwait and Qatar.
Moody's predicted that the average price of a barrel of oil to $ 33 in 2016 and $ 38 in 2017 and $ 48 in 2019.
Enterprise and Bahrain downgraded by one notch to "BAE 1" which includes some of the speculative risk and high degree of credit risk. As Oman downgraded two notches to "A1" It is still a degree above average with low credit risk.
And the form of oil and gas, 75% of Bahrain's exports and 86% of Treasury yields between 2010 and 2014, according to Moody's, although it issued a few relative quantities.
The Sultanate of Oman Famen its oil and gas 90% of Treasury yields. Financial assets of the Sultanate cover only about three years of expenses according to Moody's.
The firm said the shock that occurred in the oil market weakened budgets of the Gulf countries and economies and put them credit.
It added that the oil is 84% ​​of Saudi Arabia's exports and 40% of gross domestic product and 62% of government revenues. Before the collapse of the price of oil was believed about 90% of revenue.
Between 2013 and 2105 income fell by 23% of the gross domestic product and Saudi Arabia turned from a surplus in the budget by 6.5% of GDP in 2013 to a deficit of 15% last year.
During the same period, the current account balance fell to a Saudi compared with a total GDP of the surplus accounted for 18.2% to the deficit by 5.7% according to Moody's.
The six GCC countries have taken austerity measures, including support to reduce the fuel and energy to meet the shortfall in oil revenues.
Moody's said last month that cut subsidies on fuel will help ease the pressure on the budget, but not enough to compensate for the shortfall caused by low oil prices.