Fitch affirms Naftogaz

Fitch Ratings said it affirmed NJSC Naftogaz of Ukraine's long-term foreign and local currency issuer default ratings at CCC, while the $1.6 billion of government-guaranteed notes are affirmed at B with a recovery rating of RR4.

The issuer default ratings continue to reflect that default is a real possibility due to the continued weakness of Naftogaz's business and particularly its financial profile and its ongoing dependency on the Ukrainian government for timely liquidity support, the agency added.

Fitch said that one of the key concerns for Naftogaz is the disparity between the prices for gas imported from Russia's Gazprom (BBB/positive) and regulated tariffs for heating companies in Ukraine (B/stable).

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