Muscat: In a significant affirmation of the Sultanate of Oman’s financial resilience and progress, Moody’s Investors Service has upgraded the country’s credit rating from “Ba1” to “Baa3,” officially placing Oman in the investment-grade category. The outlook has also been changed from “positive” to “stable.”
This upgrade reflects Moody’s confidence in Oman’s improved macroeconomic and fiscal indicators. The credit rating agency cited several driving factors behind the decision, including strengthened public debt indicators, a robust improvement in the state's financial standing, and the adoption of more efficient financial management practices.
The Ministry of Finance underscored that the upgrade is the result of sustained fiscal discipline and structural reforms undertaken in recent years. During 2024, Oman witnessed notable improvements in its economic indicators. Public debt declined from 37.5% of GDP in 2023 to 35.5% in 2024. Public spending rationalization efforts also bore fruit, with spending falling from 41% of GDP during 2016–2020 to 29% in 2024. Furthermore, the average oil break-even price dropped from USD 84 per barrel (2016–2020) to USD 70 per barrel (2024–2025), underscoring enhanced budgetary efficiency.
Additional economic highlights included a reduction in the cost of public debt servicing—from 9% of total revenue in 2021 to 7.2% in 2024—and a real GDP growth of 1.7% at constant prices. Inflation remained remarkably low at 0.7%, while the fiscal surplus reached 2.8% of GDP. Oman’s current account balance also improved, rising to 2.1% of GDP.
Moody’s had previously affirmed a stable outlook for Oman in December 2023 and upgraded that to a positive outlook in August 2024. This latest upgrade to “Baa3” with a stable outlook marks a crucial shift in international perception of Oman’s economic trajectory.
Looking forward, Moody’s emphasized that further enhancements to Oman’s credit rating could materialize if the country continues to build resilience against oil price volatility. This would require Oman to further diversify its revenue sources, particularly by accelerating non-oil sector growth and reducing the non-oil primary deficit.
The Ministry of Finance reiterated its commitment to these goals, highlighting that the government will maintain its disciplined fiscal path to ensure sustainable economic development and investor confidence.
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