New war is a credit risk for Cyprus
Cyprus and Egypt are currently facing the most direct credit risks among countries rated by Scope Ratings due to the Israeli-Hamas conflict, warns the German firm.
In a report titled “Hamas Attacks Test Israel’s Economic Resilience,” the German credit rating agency last week highlighted the risks posed to regional stability and global growth. Egypt, which shares a border with Hamas-controlled Gaza, and Cyprus, dependent on Israel for oil and gas supplies, are currently at the forefront of immediate credit risks.
On a different note, Scope Ratings suggests that Turkey may enhance its regional influence as it seeks to promote stability, similar to its role during the Russia-Ukraine conflict.
In a scenario where the Israeli-Palestinian conflict escalates regionally, pushing oil prices above $100 per barrel, concerns about global inflation and central bank responses are likely to rise. This could negatively impact economic growth and credit ratings in various states.
Uncertainty regarding oil markets, inflation and growth persists, and Scope points out that the resurgence of the Israeli-Palestinian conflict raises concerns about long-term effects on oil prices.
