DUBAI (Reuters) – S&P Global (NYSE:) Ratings said on Saturday it had revised its outlook on Oman to positive from stable due to higher oil prices and fiscal reform plans that are expected to narrow state deficits and slow a rise in debt levels over the next three years.

Oman received a ‘B+/B’ rating from the ratings agency for its long-term, short-term foreign-and local-currency sovereign credit ratings.

Oman is a small producer of oil and more susceptible to price swings than the hydrocarbon-rich Gulf neighbors. This means that Oman was particularly affected by the 2020 price crash, as well as COVID-19.

“Economic and fiscal pressures on Oman are easing, as the effects of the sharp drop in oil prices in 2020 and the COVID-19 pandemic abate,” S&P said in a statement.

The fiscal deficit is expected to fall to 4.2% this year, from 15.3% in 2020.

However, lower oil prices in 2023 will result in an increase of fiscal debt, which would mean that the total financing needs (fiscal deficit and maturing debt) would continue to be high at a median about 12% GDP by 2024.

Oman’s GDP debt share jumped to nearly 80% in 2015, from a mere 5% in 2015. According to the International Monetary Fund, Oman’s total debt will drop to around 70% in 2017, compared to 5% in 2015.

Since the beginning of the year, the sultanate took steps to address its financial problems. This included an introduction tax on value and a decision to partner with IMF to devise a strategy to reduce debt.