Moody's cuts Yukos Oil

Moody's Investors Service said it downgraded Yukos Oil Co.'s senior implied rating to B2 from B1 and the issuer rating to B3 from B2. Both ratings remain under review for possible further downgrade.

Moody's said the rating action reflects an assessment of the current situation in relation to the Russian government's demand for payment of back-dated tax claims for 2000 and 2001.

It now appears increasingly likely in Moody's opinion that Yukos will sell or will be forced to sell specific assets to meet the outstanding tax claims rather than the company being sold as a whole to an entity controlled by the Russian state, which could have had a beneficial impact for lenders to Yukos from their current position.

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