"The risks to sovereign credit quality analysis are more intense for Oman, Iraq, Angola and the Republic of Congo because of limited budgetary room for manoeuvre and exacerbated liquidity pressures, which are reflected in the ratings of these countries," analysts wrote in a note released this Friday.
Moody's, which put Angola's rating under review for a possible downgrade in March, writes that "the environment of lower oil prices for longer will weaken the external and budgetary positions of all oil exporters.
The adjustments made by governments to public policies "will determine the capacity of sovereign countries to manage the shock," the analysts added, noting that they have reduced the forecast for the evolution of the price of this raw material, now anticipating an average of 35 dollars per barrel this year and 45 dollars next year, which shows a drop of US$8 per barrel against the March estimate.
"The deeper economic recession that we expect for 2020 in all advanced economies and the drastic reduction in travel, in particular, have reduced the demand for oil products beyond our previous estimates," justified Moody's vice president and analyst Alexander Perjessy.
In the analysis, Moody's says it expects an increase in the public debt to GDP ratio to 110 per cent between now and next year, and a widening of the budget deficit to almost 5 per cent of GDP this year.
In terms of monetary policy, Moody's analysts expect an "additional depreciation" due to lower oil prices, after a drop of 20 per cent this year and 56 per cent last year.