ANKARA
U.S. credit rating agency Standard & Poor’s revised its outlook on Saudi Arabia to negative Monday.
"We view Saudi Arabia's economy as undiversified and vulnerable to a steep and sustained decline in the oil price," S&P said in a statement.
While the agency affirmed the kingdom's rating -- keeping it at the relatively high level of 'AA-/A-1+ --' S&P warned that the kingdom could lose its double-A rating, the fourth highest rating, if its fiscal position weakens.
S&P pointed out that the oil sector accounts for 40 percent of the country's gross domestic product, 90 percent of its government revenue, and 85 percent of its exports. There is a danger of seeing fiscal deficits, the agency warned.
The budget for this year shows a deficit of $38.6 billion due to falling oil prices, but King Salman has ordered a $29.3 billion public spending program on Jan. 29.
"Financing the deficit and the recently announced spending package may result in a pronounced decrease in the government's net asset position or an increase in the government's currently very low debt burden," S&P said.
The rating company also cut the grades of Oman, Bahrain, Kazakhstan and Venezuela by one step, citing lower oil prices.
