Moody’s downgrades Oman to junk, outlook negative

Moody’s downgraded the long-term issuer and senior unsecured bond ratings of Oman to Ba1 from Baa3. (AFP)
Updated 06 March 2019
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Moody’s downgrades Oman to junk, outlook negative

  • Moody’s downgraded the long-term issuer and senior unsecured bond ratings of Oman to Ba1 from Baa3
  • Baa3 is Moody’s lowest investment-grade rating

DUBAI: Rating agency Moody’s downgraded Oman’s credit rating to junk, joining other rating agencies, and said its outlook for the rating is negative, citing fiscal challenges in an environment of moderate oil prices.
Moody’s downgraded the long-term issuer and senior unsecured bond ratings of Oman to Ba1 from Baa3, it said in a statement late on Tuesday. Baa3 is Moody’s lowest investment-grade rating.
“The key driver of the downgrade is Moody’s expectation that the scope for fiscal consolidation will remain more significantly constrained by the government’s economic and social stability objectives than it had previously assessed,” the rating agency said.
Fitch and S&P had both downgraded Oman to junk earlier.
The oil producer’s state coffers have been hit hard by a slump in oil prices in recent years, resulting in a wide budget deficit that the country is only slowly managing to tame.
Moody’s said Oman could face external vulnerability as wide fiscal deficits will contribute to wide current account deficits, perpetuating Oman’s dependence on steady inflows of external financing.
It said the negative outlook reflects the risk that “foreign investors’ willingness to finance Oman’s large deficits at relatively low costs could weaken, exacerbating the sovereign’s external vulnerability and raising government liquidity pressures.”
Oman raised $8 billion in international bond sales last year, covering the three-billion rial ($7.79 billion) deficit projected in its 2018 state budget.
A recovery in oil prices last year, however, narrowed the budget deficit by 43 percent to 1.87 billion rials during January to November.


China’s crude oil imports from Saudi Arabia up 43%

Updated 25 May 2019
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China’s crude oil imports from Saudi Arabia up 43%

  • Imports grew to 1.53 million barrels per day compared with 1.07 million a year ago
  • Sinopec Group and China National Petroleum Corp., the country’s top state-owned refiners, are halting Iranian oil purchases for loading in May, three people with knowledge of the matter said

BEIJING: China’s crude oil imports from Saudi Arabia rose 43 percent in April, making the Middle Eastern OPEC kingpin once again the top supplier to the world’s second-biggest economy, boosted by demand from new private refiners.
Saudi imports grew to 6.30 million tons, or 1.53 million barrels per day (bpd) on a daily basis, compared with 1.07 million bpd in the year ago period, according to data from the General Administration of Customs released on Saturday.
Saudi shipments were supported by higher refinery run rates at Hengli Petrochemical Co. Ltd, with production at the 400,000 bpd-capacity refinery in northeast China expected to reach optimal levels in late June. About 70 percent of the feedstock for Hengli came from Saudi Arabia.
Meanwhile Russian supplies were 6.12 million tons, or 1.49 million bpd, up from 1.35 million bpd in April last year.
China in April imported 3.24 million tons of crude oil from Iran, or 789,137 bpd, up from March’s 541,100 bpd, as companies ramped up buying before the scrapping of sanctions waivers the US had granted to big buyers of Iranian oil.
China Petrochemical Corp. (Sinopec Group) and China National Petroleum Corp. (CNPC), the country’s top state-owned refiners, are halting Iranian oil purchases for loading in May, three people with knowledge of the matter said.
Venezuela shipments stood at 1.9 million tons, or 462,813 bpd in April, up 85 percent versus 249,700 bpd in March, while crude imports from Iraq were 3.31 million tons, or 806,372 bpd, down from 904,500 bpd the previous month.