DUBAI: The Gulf Cooperation Council’s borrowing requirements could drop to $10 billion over the next three years from about $270 billion, if oil prices remain elevated, according to Goldman Sachs Group.
If prices for the commodity average $65 a barrel and all else is equal, borrowing needs for the six countries comprising the council would drop 96 percent from what they’d be if oil traded at $45, Bloomberg reported, citing Farouk Soussa, an economist at the bank.
Oil prices have risen by almost 80 percent since the start of November to trade around $70 per barrel.
The price outlook was further buoyed last week when OPEC+ producers agreed to extend production cuts.
Gulf states rely heavily on a strong oil price to balance their budgets and fund major infrastructure projects.
They raised about $63 billion in bonds and sukuk last year, Bloomberg said.