An-Najah News - Nablus - Kuwait has been placed on review for a downgrade of their credit ratings by Moody’s Investors Service, severely lowering the country’s likely ability to repay its debt.

The credit ratings firm, which sets the ratings as indicator of countries’ abilities to repay their national debt, announced on Monday that Kuwait is under review for a downgrade in its own ratings, marking further economic impact caused by a sharp fall in oil prices and the spread of the coronavirus pandemic.
An ongoing oil crisis has been ravaging global markets, starting when Saudi Arabia sharply increased its oil production resulting in oil prices dropping as low as $25 per barrel. It has even been predicted that this oil price war could bring the price down even further, to $10 per barrel.

The primary reason that the agency placed Kuwait on the review, is the government’s significant decline in revenue due to the oil crisis, with the decision reportedly based on the analysis of the country’s alternative sources of revenue and an assessment on whether it will be able to acquire sufficient funding in order to keep up with the increasing economic requirements.

Last week, Kuwait was forced to cut its oil expenditure and it has taken financial measures to support businesses within the country, and its banks have donated $32 million to combat the pandemic, as well as $10 million to help Iran with its crisis.