Fitch has affirmed Naftogaz’s credit rating at “CC”
12 August 20:07
Following the restructuring of Naftogaz of Ukraine’s Eurobonds totaling $0.6 billion and EUR0.7 billion, issued through Kondor Finance, the international rating agency Fitch has maintained its long-term Issuer Default Rating (IDR) at “CC,” reports "Komersant Ukrainian", citing “Interfax-Ukraine.”
“Naftogaz’s ‘CC’ IDR rating reflects uncertainty regarding its ability to service its debt in a timely manner due to projected low liquidity, very high operational risks in Ukraine—including ongoing attacks on its infrastructure amid the war with Russia, as well as limited access to external financing,” the agency’s statement reads.
It added that it also affirmed Naftogaz’s U.S. dollar- and euro-denominated bond ratings at “C” with a Recovery Rating of “RR6.”
As part of its standard rating procedure, Fitch initially downgraded Naftogaz’s rating from “CC” to “RD” and immediately restored it to “CC.”
Separately, the agency noted in its release that intensified Russian attacks on Ukraine’s oil and gas infrastructure, as significant damage to assets has forced Naftogaz to substantially increase natural gas imports during the 2025–2026 period. To finance this, the company is using its own funds, grant support from international partners, and loan financing, in particular from the EBRD and the EIB.
At the same time, Fitch views the extension of Eurobond maturities as a positive factor for the company’s credit profile. Despite the shelling, the state-owned Naftogaz remains Ukraine’s largest production company and enjoys government support, which also contributed to the rating being maintained.
Among other rated Ukrainian peers, the agency highlighted Ferrexpo plc (CC), whose rating reflects significant uncertainty regarding the group’s business continuity due to the initiation of bankruptcy proceedings against its main operating subsidiary in Ukraine, and DTEK Oil & Gas Production BV “CC” due to uncertainty regarding its ability to service future bond obligations amid the National Bank of Ukraine’s (NBU) moratorium on cross-border payments in foreign currency, high operational risks, and low liquidity.
In addition, the agency assigned ratings to Metinvest BV (CCC-) due to a reduction in liquidity reserves following the redemption of the 2026 bonds and the still-high refinancing risk ahead of the October 2027 bond maturity, DTEK Energy BV (CCC-) due to uncertainty regarding its ability to service future principal repayments on the bonds because of the NBU moratorium, as well as liquidity and refinancing risks given the December 2027 maturity date.
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