Russia's financial difficulties, triggered by the sanctions imposed by the US and the EU in reaction to the Ukrainian crisis, are also putting an oil major such as Rosneft on the ropes, which extracts about four million barrels a day and which is led by Igor Sechin, one of the loyal by President Vladimir Putin. Putin himself had to reassure investors late last week, promising that the government would provide any necessary support to the company, now the largest publicly traded oil company.
What is worrying is its debt position, with 21 billion dollars, mostly in foreign currency, due within six months. Under Rosneft's conditions, the decline in crude oil prices is certainly not welcome and only the guarantee offered by Putin will be able to avoid the specter of default. The sanctions in fact hinder access to the international capital market and are also penalizing the ruble, which in 2014 lost 30% against the dollar, a fact which aggravates the weight of debts contracted in foreign currencies.
In reality, Rosneft is too important for Russia and the risk that it will not honor its obligations should be considered low. However, the numbers are alarming: this year the company will have to repay 10,2 billion dollars and another 2015 billion for the whole of 19,5, a burden that derives mainly from the 55 billion invested in 2013 to take over its share of the Tnk-BP joint venture. Rosneft has cash on hand for at least 20 billion and credit lines for around 6 billion with which it will be able to postpone some maturities.
Meanwhile, however, Standard & Poor's assigns the company a BBB- rating with a negative outlook, an assessment that can be made to coincide with that of Russia itself, whose foreign currency reserves fell in October to 428,6 billion dollars, the minimum five years. The West accuses Putin of having destabilized Ukraine and now it is becoming difficult for several Russian companies to refinance their debt, especially those that cannot count on government aid. But the English BP is also feeling the pinch: the value of its 20% of Rosneft is in fact declining.
