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KBRA Releases Research – Update on Geopolitics and Oil: The Great Disruptors

NEW YORK–(BUSINESS WIRE)–Kroll Bond Rating Agency (KBRA) releases its Update on Geopolitics and
Oil: The Great Disruptors research report, in response to rising
geopolitical risks. This latest addition to our expanding Energy and
Sovereigns coverage provides KBRA’s opinion on the main disruptors to
global oil supply and demand.

At the top of this list is the U.S., due to its growing supply and the
international leverage it enjoys. This discussion includes countries
with extreme domestic political risk (Nigeria and Libya) as well as
those which could be incredibly disruptive to the oil markets should
their resource potential be realized, namely Venezuela and Iran. The
report also highlights the destabilizing security events in the Strait
of Hormuz. This report is a follow-up to earlier KBRA research on
oil-sector performance that highlights our expectation for continued
price volatility in the near term.

The main takeaways from this report include:

  • The U.S. is a powerful disruptor due to its size, its growing oil
    production, and the role of the U.S. dollar.
  • Libya and Nigeria represent the biggest oil market disruptors in terms
    of domestic political risk.
  • Iranian and Venezuelan oil production will continue to fall over the
    near to medium term.
  • Security events in Strait of Hormuz are likely to rise.
  • Global demand is slackening, accelerated by heightened trade conflict.
    KBRA expects further downward revisions to global growth and we are
    concerned about China’s growth outlook, in the context of its heavy
    indebtedness.

Related Publications: (available at www.kbra.com)

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About KBRA and KBRA Europe

KBRA is a full-service credit rating agency registered with the U.S.
Securities and Exchange Commission as an NRSRO. In addition, KBRA is
designated as a designated rating organization by the Ontario Securities
Commission for issuers of asset-backed securities to file a short form
prospectus or shelf prospectus. KBRA is also recognized by the National
Association of Insurance Commissioners as a Credit Rating Provider and
is a certified Credit Rating Agency (CRA) by the European Securities and
Markets Authority (ESMA). Kroll Bond Rating Agency Europe Limited is
registered with ESMA as a CRA.

Contacts

Analytical Contacts:
Joan
Feldbaum-Vidra, Managing Director, Sovereigns
(646) 731-2362
jfeldbaumvidra@kbra.com

Corinne Hill, CFA, Senior Director, Corporates
(646) 731-3331
chill@kbra.com

Van Hesser, Senior Managing Director, Financial Institutions and
Corporates
(646) 731-2305
vhesser@kbra.com

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