Moody's assigns first-time A1 rating to Saudi Aramco with stable outlook

01/04/2019 Argaam

 

Moody's Investors Service on Monday assigned a first-time A1 long-term issuer rating to Saudi Arabian Oil Company (Saudi Aramco) and a provisional (P) A1 rating to Saudi Aramco's Global Medium Term Note (GMTN) program, a statement said, adding that the outlook is stable.

 

"Saudi Aramco has many characteristics of a Aaa-rated corporate, with minimal debt relative to cash flows, large scale of production, market leadership and access in Saudi Arabia to one of the world's largest hydrocarbon reserves. These features position it favourably against the strongest oil and gas companies that Moody's rates," said Rehan Akbar, a Vice President - Senior Credit Officer at Moody's.

 

Also read: Saudi Aramco 'eyes' new gas acquisitions in US: CEO

 

"The final rating is however constrained by the government of Saudi Arabia's A1 rating because of the close interlinkages between the sovereign and the company," it added.

 

Moody’s said Saudi Aramco benefits from a very large operational scale, significant downstream integration and strong financial flexibility given its low cost structure and robust balance sheet. This provides considerable credit resilience through oil price cycles.

 

“The company is the world's largest oil supplier and has exclusive access to nearly all of Saudi Arabia's vast hydrocarbon resources, which are one of the world's largest proven oil and gas reserves,” the rating agency said.

 

It however added that Saudi Aramco's rating is constrained by the rating of the government of Saudi Arabia given the broad credit linkages between the two.

Comments {{getCommentCount()}}

Be the first to comment

loader Train
Sorry: the validity period has ended to comment on this news
Opinions expressed in the comments section do not reflect the views of Argaam. Abusive comments of any kind will be removed. Political or religious commentary will not be tolerated.