Fitch puts Net4gas on watch

Fitch Ratings said it placed Net4gas, sro's long-term issuer default rating and senior unsecured rating of BBB on rating watch negative.

“The RWN reflects the increased and rising risks to Gazprom's (B/RWN) willingness and ability to honor its obligation under its "ship-or pay" gas transit contracts with Net4Gas, which make up more than 70% the company's revenues. This follows tightening sanctions on Russia and its corporates and Russia's own restrictions since its military invasion of Ukraine last week as well as Europe's growing desire to reduce its energy imports from Russia,” Fitch said in a press release.

Fitch said it aims to resolve the RWN once it has better long-term visibility of the transit business and Net4gas's target financial profile, assuming significant changes in the European gas market. This could take longer than six months.

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