Moody's: CNPC outlook stable

Moody's Investors Service said it changed to stable from positive the outlook on China National Petroleum Corp.'s Aa3 issuer rating and affirmed the rating.

The rating action follows the change in the outlook on China's Aa3 government's bond rating to stable from positive.

"Given CNPC's position as a government-related issuer and its strategic importance in the national oil and gas sector, its Aa3 rating ... incorporates a very high level of support from the Chinese government, its 100% shareholder. Accordingly, a change in the sovereign rating or its outlook will lead to a corresponding rating or outlook change for the company," Simon Wong, a Moody's vice president and senior analyst, said in an agency news release.

The company's rating is underpinned by its large reserve base and strong operational profile, its dominant position in China and its solid financial metrics and liquidity profile, the agency said.

In Moody's view, these strengths are counterbalanced by the geopolitical and event risks associated with its fast pace of expansion overseas and by the social and political responsibilities it bears as a pivotal state-owned enterprise.

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