Soaring oil prices increase fiscal uncertainty, S&P downgrades Belgium's credit rating

The main reason for the downgrade, according to S&P, is "Belgium's long-term public finance imbalance." In a statement, S&P said Belgium's budget deficit will widen significantly in 2025, while the fiscal consolidation plan for 2026 to 2029 is progressing slowly, leaving the country facing serious fiscal challenges. S&P expects the ratio of Belgian government net debt to gross domestic product to rise from 103% in 2025 to 109% in 2029, with interest expenses also set to grow considerably. S&P also stated that Belgium's reliance on fossil fuels, coupled with an already tight energy supply, makes it vulnerable to the surge in international oil prices caused by the current Middle East conflict, bringing new uncertainty to public finances.