S&P Global Ratings has affirmed Saudi Arabia’s sovereign credit rating at A+ with a stable outlook, citing the kingdom’s fiscal buffers, export flexibility and continued non-oil growth as factors that could help it weather escalating regional tensions.

The agency maintained its “A+/A-1” long- and short-term foreign and local currency sovereign ratings, noting that Saudi Arabia has the capacity to reroute crude exports through the Red Sea, rely on storage facilities and increase production once regional tensions subside.

S&P also pointed to expectations of sustained non-oil economic growth and related revenue streams, alongside the government’s ability to adjust investment spending linked to Saudi Vision 2030, as supportive of the country’s economic and fiscal outlook.

The assessment comes after Israeli and US strikes on Iran on Feb. 28 triggered a sharp escalation in Middle East tensions, disrupting global energy markets.

The Strait of Hormuz—which typically carries around one-fifth of global oil shipments—has effectively been closed to most international shipping after Iran imposed transit restrictions.

As a result, hydrocarbon supplies have been affected, pushing Brent crude oil close to $120 per barrel by March 9 before easing to about $101 by March 13, compared with $72.5 on Feb. 27 and an average of $66 in January 2026. Natural gas prices have also risen sharply.

In its latest report, S&P said it expects real GDP growth of 4.4% in 2026, supported in part by an increase in oil production to an average 10.1 million barrels per day, up from 9.5 million barrels per day in 2025, alongside higher oil prices driven by geopolitical risk premiums.

For 2027–2028, the agency forecasts average real GDP growth of 3.3 percent annually, assuming disruptions from targeted attacks will not significantly affect global supply. S&P said Saudi Arabia is likely to utilise the East-West pipeline and storage facilities and increase production once tensions ease to offset any lost output.

The agency warned a downgrade could occur if the conflict intensifies or persists long enough to weaken economic growth, fiscal balances or external accounts, or if government debt rises sharply. Conversely, an upgrade could be considered within two years if tensions ease and reforms, alongside strong non-oil growth, accelerate diversification and strengthen fiscal revenues.