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S&P cuts Saudi Arabia, Brazil, Oman, Kazakhstan, Bahrain, keeps Russia

Staff writer |
Rating agency Standard & Poor's downgraded Saudi Arabia, Brazil, Kazakhstan, Bahrain and Oman's credit ratings in its second mass cut of large oil producers.

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S&P cited the pressures being created by the drop in oil prices for the moves which included double-notch downgrades of Saudi Arabia to A- stable from A+ negative and stripping Bahrain of its investment grade status.

"The decline in oil prices will have a marked and lasting impact on Saudi Arabia's fiscal and economic indicators given its high dependence on oil," the ratings agency said in a statement.

One country that was spared this time was Russia. S&P said Moscow's fiscal buffers gave it more leeway, though it could still cut its BB+ rating again if those were eroded faster than expected or if international sanctions were "significantly" tightened again.

Like Saudi Arabia, Bahrain saw its rating cut two notches. Significantly, though, it also lost investment grade as it went to BB from BBB-.

Oman was lowered two steps as well to BBB- stable from BBB+ negative while Kazakhstan was cut one notch to BBB- from BBB but left on a negative outlook due to concerns about inflation, exchange rate pressures and banking sector stability.

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