Fitch rates OAO LUKoil

Fitch Ratings said it assigned OAO LUKoil foreign currency and local currency issuer default ratings of BBB- and short-term rating of F3.

The outlooks for the issuer default ratings are stable.

At the same time, the agency said it assigned a rating of BBB- to the $350 million convertible bond issued by LUKInter Finance BV.

Fitch said the stable outlook foresees LUKoil's continued profitability resulting from sustained growth in crude oil and oil product production, favorable foreign oil prices and growing access to lucrative export markets, especially in North America.

On the other hand, aggressive tax legislation, high export tariffs, high transportation costs and increasing domestic downstream competition remain credit concerns, the agency added.

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