Global rating agency Fitch Ratings upgraded the long-term foreign currency issuer default rating on Oman to BB from BB-.
The outlook on Oman is stable, Fitch said on Monday.
The agency said the upgrade “reflects significant improvements in Oman’s fiscal metrics, a lessening of external financing pressures and ongoing efforts to reform public finances.”
A relatively small crude producer when compared to its wealthier Gulf neighbors, Oman is more sensitive to oil price swings, meaning it was hit especially hard by the pandemic-driven price crash in 2020.
But higher oil prices this year along with fiscal reforms, Fitch said, will support the sultanate to register its first budget surplus since 2013 and contain debt levels over the next few years.
“Higher oil revenue will underpin budget surpluses in 2022 and 2023,” Fitch said.