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With the recent collapse of oil and gas prices, S&P Global Ratings has lowered T&T’s long-term foreign and local currency sovereign credit ratings to “BBB-” from “BBB”. It says however that the outlook is stable.

At the same time, S&P Global Ratings lowered its short-term foreign and local currency sovereign credit ratings to “A-3” from “A-2”. S&P Global Ratings also revised down its transfer and convertibility assessment to “BBB” from “BBB+”.

According to S&P Global Ratings, the decision to revise downwards this country’s sovereign rating was based on expected lower oil and gas prices over the next several years that it estimates will the government revenues and lead to larger increases in net general government debt.

S&P Global rating said the stable outlook balances the risk that lower hydrocarbon prices may lead to greater deterioration in the country’s growth, external finances, or interest burden, with its expectation that the government’s financial assets will provide a safeguard for economic volatility.

“The stable outlook reflects our expectation that lower oil and gas prices will lead to larger increases in net general government debt, a fall in exports that will contribute to a moderate current account deficit, and an economic contraction in 2020. Nevertheless, we believe that the government’s liquid external assets provide some flexibility to mitigate the impact of lower prices,” the report read.

T&T is expecting to have a $5 billion shortfall in revenue in this fiscal year due to the impact of lower demand for energy and with it a massive fall in oil and gas prices.