ECONOMY

Moody’s says attacks on Saudi Aramco facilities are ‘credit negative’

The attacks on Saudi Aramco are “credit negative and the disruption is significant,” said Moody’s.

The attacks on Saudi Aramco’s oil facilities on Saturday are “credit negative and the disruption is significant,” Rehan Akbar, a Moody’s vice president, said on Monday.

Akbar added that the ratings agency does not expect the attacks “to leave a long-lasting impact on Saudi Aramco’s financial profile, given its robust balance sheet and strong liquidity buffers.”

“This event, however, highlights the credit linkages the company has to Saudi Arabia both in terms of geographic concentration, and more importantly exposure to geopolitical risk,” Akbar said on Monday.

The attacks on the oil facilities interrupted the supply of an estimated 5.7 million barrels of crude per day - around five percent of global supply - and two billion cubic feet of gas.

The strikes have been claimed by the Iran-backed Houthi militia in Yemen. However, the scope and precision of the drone attacks show they were launched from a west-northwest direction rather than from Yemen to the south, senior US administration officials said on Sunday.

Oil prices have surged in response to the attack. Saudi Arabian authorities have pledged to use the Kingdom’s oil reserves to compensate for any disruption in supply to its customers.

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Last Update: Tuesday, 17 September 2019 KSA 07:11 - GMT 04:11
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