Low Oil Prices to Pressure Credit Profiles of Major Exporters in 2016

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The decline of oil prices will continue to put major exporters under pressure throughout 2016 and may affect their sovereign credit rating, Fitch Ratings agency said in a press release on Tuesday.

WASHINGTON (Sputnik) — Fitch noted that it has already downgraded ratings of five countries in the last 12 months because oil sales accounted for a large portion of their revenues.

“Fitch forecasts Brent to average USD55/bbl next year and USD65/bbl in 2017,” the release said. “Vulnerability [of exporters] varies but the impact could be felt through negative sovereign rating actions.”

The agency explained that the measures that can be taken by countries’ authorities include raising oil production, boosting non-oil revenues, rationalizing expenditure and devaluating exchange rate, the release said.

Global oil prices have more than halved from summer 2014 levels, when the price of Brent crude stood at about $115 per barrel. Current oil prices are hovering around $40-50 per barrel.

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