In its latest report, credit ratings agency Fitch has upgraded Qatar’s credit rating to AA from AA- with a stable outlook.
According to the agency, Qatar’s anticipated budget surplus until the next decade is attributed to the gas-related revenue generated from the expansion of the Northern Field.
The upgraded rating reflects Fitch’s increased confidence in Qatar’s ability to maintain a debt-to-GDP ratio that is in line with or below the average of other AA-rated nations.
Fitch acknowledged the regional instability caused by the Gaza war and highlighted Qatar’s current lack of direct impact. However, the ongoing conflict poses a continued risk of escalation.
The report highlighted that the upgrade to AA signifies Fitch’s belief that Qatar’s debt-to-GDP ratio will remain in line with or below the average of comparable nations, following a significant decline in recent years.
Qatar’s upgraded rating is supported by its substantial foreign sovereign net assets (SNFA), one of the highest per capita GDP ratios globally, and a flexible overall financial structure, the agency said.
Additionally, the report noted that Qatar’s government is expected to achieve an overall budget surplus of 8.6 percent of GDP in 2024, slightly lower than the 9.3 percent recorded in 2023.
Furthermore, Fitch anticipated that the fiscal revenues from the first phase of the Northern Field expansion will be fully realized by 2026, with the second phase following in 2027, assuming no construction delays. This expansion is projected to reduce Qatar’s fiscal breakeven price to $50 per barrel in 2027, down from approximately $64 per barrel in 2024.
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