"The stabilization of oil prices has eased the direct and indirect economic and fiscal pressures on the nine rated sovereigns in the Commonwealth of Independent States (CIS) region," the agency said in a statement following the release of its outlook for the CIS.
Despite the recovery, the Moody's outlook for the region remains negative due to continued vulnerabilities to external shocks of some CIS states as well as a lack of structural reforms, the statement added, noting, however, that the region's governments had responded soundly to the oil price slump.
"CIS governments managed the oil-price shock with increasingly orthodox policies, such as floating exchange rates and tight fiscal and monetary policies. These have mitigated the effects of the collapse in oil prices, and positioned most CIS countries for a modest economic turnaround in 2017," Moody's Senior Vice President Kristin Lindow was quoted as saying in the statement.
The agency's average 2017 growth rate forecast across the region has been estimated at 2 percent, up from the 2016 estimate of 1 percent. Growth is then expected to pick up in 2018, reaching 3 percent, according to the agency.
Oil exporting states, such as CIS members Russia, Azerbaijan and Kazakhstan, took a major fiscal hit in 2015-2016 as oil prices collapsed amid a glut in the global energy market. Prices plunged from $115 per barrel in June 2014 to less than $30 per barrel in January 2016. Prices then recovered to over $40 per barrel before rallying to around $55 per barrel after the late 2016 output cut deal by a large number of oil producers.
In 2016, Russia's economy is estimated to have grown by just 0.5 percent after contracting almost 4 percent the previous year. Most neighboring CIS states, including Azerbaijan, Kazakhstan, Belarus and Kyrgyzstan, all experienced negative or near-zero growth rates throughout 2016.
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