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Source: Dubai – Mr. Muhammad
On Friday, Moody’s confirmed Saudi Arabia’s credit rating as it narrowed its outlook, saying the budget performed strongly with low debt levels.
The agency added in a research note seen by Al Arabiya.net that changing the future view of Saudi debt to negative reflects low oil prices with the impact of the Corona virus epidemic that overshadows all countries in the world.
He also noted that declining oil prices caused the loss of oil revenues and exports due to declining demand for crude oil, which hit world markets during the past period in the context of the pandemic.
However, Moody’s noted a solid performance in the Saudi budget, with strong fiscal reserves and low debt levels.
The note continued: “The stabilization of Saudi Arabia’s credit rating despite the decline in oil prices is due to the strength of the government budget due to low levels of debt and liquidity actions that allow the absorption of shocks. …
He added: “These things will help add strength to the economy even in a low oil price environment.”
The agency expected Saudi oil revenues to drop by approximately 33% this year and approximately 25% in 2021, despite the high rate of decline in oil prices.
“The slowdown in GDP will put pressure on oil sector revenues, but the impact on the government budget will be limited, given the limited budget dependency on non-oil revenues,” Moody’s added.
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