Credit ratings agency Moody's upgraded Oman's long-term issuer and senior unsecured ratings to "Baa3" from "Ba1" on Thursday, citing expectations of continued improvement in debt ratios and resilience to lower oil prices.

"We expect Oman's debt metrics to remain robust and consistent with a Baa3 rating even under alternative scenarios where oil prices moderate below our medium-term assumption of $65/barrel," Moody's said in a statement.

The agency, however, revised Oman's outlook to "stable" from "positive", noting that the country's medium-term fiscal outlook remains vulnerable to declines in global oil demand and prices due to its still-heavy economic and fiscal reliance on the hydrocarbon sector.

Moody's said stronger debt metrics provide the government with greater fiscal space and time to implement structural reforms that could, over time, reduce its dependence on hydrocarbons and potentially support a higher rating. (Reporting by Aatrayee Chatterjee in Bengaluru; Editing by Shilpi Majumdar)