RIYADH, March 26 — Rating agency S&P revised Saudi Arabia’s outlook to “positive” from “stable” yesterday, citing improving GDP growth and fiscal dynamics over the medium term.

S&P affirmed the country’s rating at “A-/A-2”.

Saudi GDP rose by 3.3 per cent in 2021, according to official statistics released last week, a turn from the 4.1 per cent contraction in 2020, when oil crashed and economies across the world were hammered by the pandemic.

Oil prices leapt 50 per cent last year as demand recovered, and then surged above US$100 a barrel to 14-year highs in February after Russia invaded Ukraine, leading Western nations to urge major producers to increase output.

Demand for Saudi crude oil has been further underpinned by demand as some countries attempt to reduce imports from Russia, S&P said.

The rating agency in its report forecast Saudi real GDP growth for the current year to rise to 5.8 per cent and average 2.7 per cent from 2023 to 2025.

“Higher global oil prices and rising production volumes, alongside a recovery from the Covid-19 pandemic, are supporting Saudi Arabia’s fiscal and GDP growth dynamics,” S&P said. — Reuters