Fitch affirms Oman's rating at BB+ with stable outlook

Fitch Ratings has affirmed Oman's credit rating as BB+ with a stable outlook as a result of the decline in public debt and its positive impact on finances.

Fitch expects Oman to achieve a fiscal surplus of 2.2 percent of GDP in 2024 and 0.9 percent in 2025 assuming the average oil price reaches about US$80 per barrel in 2024 and about US$70 per barrel in 2025.

The agency expects the oil price break-even point in Oman to reach between US$65-70 dollars per barrel.

The agency said it expects public debt as a percentage of GDP to decrease from 36.5 percent at the end of 2023 to 32.4 percent in 2024 and 31.9 percent in 2025.

It indicated that the Sultanate will continue to repay some debts before their due date benefiting from additional revenues resulting from high oil prices.

The agency expects the government to repay about US$2.9 billion of its foreign debt in the first half of 2024.

The agency predicts GDP will grow from 1.3 percent in 2023 to 1.8 percent in 2024 supported by the growth of the non-oil sector by 2.7 percent.

This growth is attributed to increased domestic consumption, growth in foreign investments and an improvement in the tourism sector. The agency also expects the non-oil sector to grow to 2.8 percent in 2025.

Fitch said Oman's credit rating may rise if financial control measures continue, public debt declines as a percentage of gross domestic product and non-oil revenues grow.