Fitch affirms ratings of SOCAR, peer oil & gas producers

Fitch Ratings has affirmed the credit ratings of 11 oil and gas producing companies, including the State Oil Company of Azerbaijan (SOCAR), following revisions to its corporate rating criteria and sector assessment frameworks.

According to Fitch, the companies whose ratings were affirmed also include QatarEnergy, Saudi Aramco, BP, OMV, Repsol, EDO, OQ, KazMunayGas, Romgaz, and Uzbekneftegaz, Caliber.Az reports via local media. 

As part of the review, Fitch reassessed SOCAR’s standalone credit profile (SCP) using its Corporate Rating Tool. Based on this analysis, SOCAR’s SCP was determined at the “bb-” level, reflecting the agency’s view of the company’s business and financial fundamentals.

Fitch assigned SOCAR a management score of “bb,” while industry characteristics were assessed at “bb+.” The company’s market and competitive position was rated “bbb-,” and its diversification and asset quality at “bb+.” Operating characteristics and management were both scored at “bb,” while profitability received a higher assessment of “bbb.” SOCAR’s financial structure was rated at “b-,” and its financial flexibility at “b+.”

The quantitative assessment incorporated both historical data and forward-looking projections. Actual 2024 results were given a 10% weighting, with a further 10% allocated to the 2025 forecast. Forecasts for 2026 and 2027 each accounted for 30%, while the 2028 forecast was assigned a 20% weighting.

Fitch also assessed SOCAR’s corporate governance as “good” and its operating environment at the “bb-” level. Neither of these factors led to any adjustment to the company’s standalone credit profile.

In determining SOCAR’s long-term Issuer Default Rating, Fitch applied its Government-Related Entities criteria using an equalized approach, reflecting the company’s links to the Azerbaijani state.

By Sabina Mammadli