Moody's ups Gazprom to A3

Moody's Investors Service said it upgraded the senior unsecured issuer and debt ratings of OJSC Gazprom from Baa1 to A3, and upgraded to A3 Gazprom's loan participation notes issued out of Gaz Capital SA and Gazstream SA.

The outlook is stable.

The action reflects a number of continuous improvements to the company's fundamental credit profile, including strong successive cash flow generation and the prospect of a more diversified and sustainable earnings stream, the agency said. Moody's said it also believes that recent pricing alignments of Former Soviet Union countries closer to Western European export prices will start to positively impact cash flows over time.

However, Moody's expressed some concern about Gazprom's ongoing reliance on Central Asian imports to meet domestic and international gas supply obligations.

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