Nine oil exporting countries in the Middle East and North Africa (MENA) would see their total hydrocarbon earnings decline by $192 billion in 2020, according to the Institute of International Finance (IIF).
Based on a scenario of that crude oil prices would average $40 per barrel this year, these nine countries' cumulative current account balance would decrease from a surplus of $65 billion in 2019 to a deficit of $67 billion in 2020, the IIF said in a statement.
In addition, their fiscal deficit would widen from 2.9% of their gross domestic product (GDP) to 9.1%, according to the statement released on Friday.
"Quarantines, disruption in supply chains, the crash in oil prices in light of the breakdown of OPEC+, travel restrictions, and business closings point to a recession in the
MENA region, the first in three decades," it said.
"Governments are trying to mitigate the economic damage with stimulus packages, but many are starting from a weak position," it added.
Among the nine oil exporting countries, Iran and Algeria are anticipated to take the biggest as their GDP levels are forecast in 2020 to contract by 8.4% and 1.5%, respectively.
They will be followed by Bahrain, which is estimated to see its GDP fall by 0.7%, and by Iraq who is expected to see its GDP decline by 0.3% this year, compared to 2019, according to the IIF.
Oman, Qatar and the United Arab Emirates are forecast to see their GDP levels increase by 0.2%, 0.4% and 0.6% in 2020, respectively, Saudi Arabia is expected to see its GDP grow by 0.7% and Kuwait is estimated to have a GDP growth of 0.8%.
The IIF anticipates the overall GDP of MENA region to contract by 0.3% this year, from the previous year.
By Ovunc Kutlu