Moody’s downgrades Israel’s rating due to conflict with Hamas. On February 15, US rating agency Moody’s downgraded Israel’s credit rating by one notch, from A1 to A2, due to the consequences of the ongoing conflict with Hamas in Gaza.
In a statement, Moody’s said it did so after assessing that “the ongoing military conflict with Hamas, its fallout and broader implications materially increase political risk for Israel, as well as weaken its executive and legislative institutions and its fiscal sustainability for the foreseeable future.”
The ratings agency also lowered its outlook on Israel’s debt to negative due to the “risk of escalation” with the much more powerful Lebanese militant group Hezbollah, which operates along the country’s northern border.
S&P Global Ratings and Fitch set Israel’s credit rating as “negative” following the outbreak of war in Gaza.
Meanwhile, in good news, oil prices fall after Israel says attacks on Gaza have ended. Oil prices fell in early Asian trade on February 12. Israel said it had “completed” a series of attacks in the southern Gaza Strip, slightly easing concerns about supplies from the Middle East.
Brent crude futures fell 29 cents, or 0.4%, to $81.90 a barrel, while U.S. West Texas Intermediate crude futures fell 28 cents, or 0.4%, to 76 $.56 a barrel.
Geopolitical risks, including fears of an Israeli-Palestinian conflict spreading into the region and potential oil supply disruptions in the Middle East, pushed prices up about 6% last week. Now the unknown remains of the Red Sea where US, British and Israeli ships are targeted by the Houthis, giving rise to a real naval blockade.
Antonio Albanese e Graziella Giangiulio
