Emirate of Abu Dhabi

This report does not constitute a rating action. Overview Institutional and economic profile Flexibility and performance profile Abu Dhabi has a very wealthy economy, but growth rates are volatile, since about 50% of economic output is derived from the hydrocarbon sector. Abu Dhabi's fiscal buffers of more than 350% of GDP underpin its creditworthiness. --Real GDP growth accelerated to 9.3% in 2022 but we expect it to be broadly flat in 2023 due to the OPEC+ agreement to cut oil production. --The emirate's government balance remains correlated to oil price and volume movements, notwithstanding the addition of nonoil revenue streams such as value-added tax. --We expect regional geopolitical tensions will, on balance, have a limited effect on Abu Dhabi, amid

...S&P Global Ratings expect Abu Dhabi's oil production to increase over the medium term as OPEC+ quotas are lifted and capacity increases to 5 million barrels per day (bpd) by 2027 from about 4 million bpd. In late 2022, state-owned oil producer, refiner, and distributor Abu Dhabi National Oil Co. (ADNOC) brought forward its expansion target to 2027 from 2030. Notwithstanding this assumption, we expect oil production to fall to about 2.9 million bpd on average in 2023 based on the October 2022 OPEC+ announcement, following an average of 3.07 million bpd in 2022. We expect oil production to rise again in 2024 (3.05 million bpd) and 2025 (3.15 million bpd), although given the capacity expansion plans, there is upside to these production levels....

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