S&P downgrades Oman

Standard & Poor’s said it lowered the long-term foreign- and local-currency sovereign credit ratings on the Sultanate of Oman to BBB- from BBB+, along with its short-term foreign- and local-currency sovereign credit ratings to A-3 from A-2.

The outlook is stable.

The agency also said it revised the transfer and convertibility assessment on Oman to BBB from A-.

As a sovereign rating, the ratings on Kazakhstan are subject to certain publication restrictions, including publication in accordance with a pre-established calendar.

Deviations from the announced calendar are allowed only in limited circumstances and must be accompanied by a detailed explanation of the reasons for the deviation, S&P said.

In this case, the reason for the deviation is the recent revision of global oil-price assumptions, the agency said.

In mid-January, S&P materially lowered its oil price assumptions for the period of 2016 through 2019.

Prices for crude oil in spot and futures markets are about 70% below mid-2014 levels, when prices began to slide, the agency said.

Back in September 2015, S&P said it expected Brent oil prices to average $65 per barrel in 2016 and $75 per barrel in 2017 and beyond.

But, now the agency said it assumes an average Brent oil price of $40 per barrel in 2016 and $45 per barrel in 2016 through 2019.

S&P said it believes the decline in oil prices will have a significant impact on Oman’s economic and fiscal indicators given its high dependence on oil.

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