The increase in tensions between the US and Iran since May 2019 has not led S&P Global Ratings to change any ratings or outlooks on corporate or infrastructure issuers it rates in the GCC, the financial services company said.

“This is because, under our base-case scenario, we do not expect direct military conflict between the two countries or their regional allies, and we believe that the Strait of Hormuz will remain open to the global oil trade,” it added.

“We also identified two hypothetical stress scenarios, described in the Appendix below. Under our hypothetical modest stress scenario (Scenario 1), which we believe is unlikely at this stage, we could see some pressure on revenue generation and access to liquidity for certain industries, but we would expect any negative rating pressure to be limited,” said S&P.

“However, under a more severe hypothetical stress scenario (Scenario 2), which we believe is quite remote, we would expect to see more pronounced rating actions in our portfolio,” it added. – TradeArabia News Service