Oman credit rating raised to investment grade

Fitch Ratings has raised Oman’s Long-Term Foreign-Currency Issuer Default Rating in its report issued today from BB+ to BBB-, placing Oman within investment grade territory with a Stable Outlook.

The upgrade reflects continued improvement in public finance indicators, the external balance sheet and the agency’s growing confidence in Oman’s ability to maintain prudent fiscal policies that help manage oil-price volatility, keep the budget deficit moderate and maintain stable levels of public debt.

The agency notes that Oman has strengthened fiscal discipline. Public debt fell markedly to about 36 percent of GDP in 2025, compared with roughly 68 percent in 2020.

Fitch expects the budget deficit to remain at safe levels of around 1 percent of GDP in 2026–2027, based on an average Brent price assumption of 63 USD per barrel. The fiscal breakeven oil price stands at about 67 USD per barrel for the same period.

Fitch projects GDP growth of about 4% in 2025, compared with roughly 1.6% in 2024. This outlook is supported by strong expansion in the non-oil sector of around 3.8%, alongside faster growth in the oil sector driven by the easing of production limits under OPEC Plus.

Domestic spending, foreign direct investment inflows and a continued rise in tourism activity are likely to support non-oil growth. Fitch expects it to remain above 3.5 percent in 2026–2027.

The report highlights a significant shift in Oman’s external balance sheet. Oman became a net external creditor in 2024 by about 2 percent of GDP. This marks a major improvement from its status as a net debtor in 2021. The progress resulted from government debt repayments, lower liabilities of state-owned enterprises, growth in external assets and stronger external buffers as reserves increased.

Fitch states that Oman’s rating could be raised further if the Government enhances the budget’s resilience to oil-price fluctuations by broadening non-oil revenue sources, continues strengthening the sovereign balance sheet through further debt reduction and repayment, and boosts external reserves and expands assets in the sovereign wealth fund.

Oman has now reached investment-grade status with all major credit-rating agencies. Fitch’s upgrade represents another important milestone, reflecting the success of Oman’s prudent economic and fiscal policies in recent years. It also opens the door to greater foreign investment and strengthens confidence in the national economy. This supports the country’s path towards sustainable development and economic diversification under Oman Vision 2040.

This is an unofficial English version of an Arabic report. To view the official Arabic text, click here.