Although oil price remains well over the oil producer's breakeven budget, Gulf countries have not been spared from the contagion of the European banking crisis, which recently turned into a more problematic sovereign debt conundrum.A dearth of dollar funding plagues the market as European banks hold back from taking on more exposure to emerging markets, making access to debt capital markets more expensive. This has resulted to serious refinancing issues in the region.Data from the Bank for International Settlements (BIS) shows foreign claims on Gulf Co-operation Council (GCC) economies by European banks account for almost 70% of the total while claims by US banks represent 11%.
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