BAKU, Azerbaijan, Aug.10. Moody's has upgraded the ratings of State Oil Company of the Azerbaijan Republic (SOCAR) to Ba1 from Ba2, including its corporate family rating (CFR) and senior unsecured rating, Trend reports with reference to Moody’s.
“Today's rating action is in line with the sovereign rating action and reflects SOCAR's strong credit linkages with the state as well as its significant exposure to Azerbaijan's operating and macroeconomic environment. The upgrade of Azerbaijan's ratings reflects improved policy effectiveness in recent years which translates into improved fiscal management and increased capacity to absorb future shocks. Despite the pandemic, fiscal metrics have remained strong and are improving quicker than expected thanks to prudent fiscal management amid an economic rebound and high hydrocarbon prices. Moody's expects the government's anti-inflation measures and the Central Bank of the Republic of Azerbaijan's (CBAR) proactive macroeconomic policy to contain inflation risks exacerbated by the Russia/Ukraine crisis. As a result, Moody's expects that operating and macroeconomic environment for SOCAR will gradually improve, supporting its credit profile,” said the rating agency.
Moody’s notes that the stable outlook on SOCAR's rating is in line with the stable outlook on Azerbaijan's sovereign rating and reflects Moody's view that the company's specific credit factors, including its operating and financial performance, market position and liquidity, will remain commensurate with its rating on a sustainable basis.
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