The strong sovereign ratings of most Arab Gulf oil exporters are underpinned by vast hydrocarbon wealth, while oil importers in the Middle East and North Africa (Mena) are most at risk of a rating cut due to spillover from the eurozone debt crisis, ratings agency Standard & Poor's said yesterday.

"The fiscal strength of the region’s oil exporters keeps them in a good position with their large oil revenues that support their ability to meet their financial obligation on a timely basis,” Trevor Cullinan, director of sovereign ratings at S&P, told journalists in Dubai.

The AA ratings of Gulf countries like Saudi Arabia, the UAE, Kuwait and Qatar are all shielded by their relative oil riches, S&P said. Oil exporters Oman and Bahrain are vulnerable, however, to a potential downgrade in the future due to political risks in both countries.

“We look at Bahrain with a bit of concern...Bahrain hasn’t received, as far as we know, any of the $ 10bn it was promised by other GCC countries,” said Kai Stukenbrock, S&P’s senior director for sovereign and international public finance ratings, adding that months of instability and lower oil exports compared to its GCC counterparts, have affected the country’s outlook.

Bahrain, currently rated BBB with a negative outlook, has been impacted by the “deterioration of the political situation, the deterioration of its fiscal policy and the pressures on its public finances after the country upped its public spending,” said Stukenbrock.

Oman remains a concern for S&P as well due to political risks and the scope for fiscal reform, said Dima Jaradneh, a director of sovereign ratings at S&P. Oman too hasn’t received any of the promised financial aid from its GCC counterparts in the wake of its political upheavals.

Oman’s negative outlook “reflected our view of the likelihood of a downgrade if latent political risks re-emerged and couldn’t be appeased by the planned increases in spending,” said Jardaneh.

Oil importers in the Mena region will on the other hand feel the impact of the eurozone spillover more than their oil exporting counterparts, with Jordan, Tunisia and Egypt particularly vulnerable to a sovereign rating downgrade as result, S&P said. Deleveraging by European banks, lower remittances, and a drop in trade and tourism numbers have all weighed on the oil importers in the Mena region, it added.