Bahrain Debt Burden Reaches $60 Billion as Oil Revenue Dwindles

Bahrain's government debt has reached $60 billion, with economists warning that it will become increasingly difficult for the country to service its debt beyond 2026. The US-Israeli war on Iran and the near-closure of the Strait of Hormuz have caused Bahrain's oil production to plummet, putting further pressure on already-strained government finances.

The country's external government debt totals $43 billion as of March 31, with a further $17 billion in gross domestic debt. This brings the total government debt to $60 billion, according to a sovereign bond prospectus from June.

Justin Alexander, director of Khalij Economics, said that if the war continues and Bahrain fails to receive support, it will default on its debt. 'Bahrain has few liquid assets that it could realise at short notice,' he warned.