Saudi Arabia Credit Rating Is Cut By Standard & Poor's -- October 30, 2015

Updates

Don also provided the answer to the second of two questions at the end of the original post. Bloomberg Business reported earlier this year, April, 2015: 

Russia’s foreign-currency credit rating was kept one step below investment grade at Standard & Poor’s as policy makers struggle to boost growth and the financial system risks weakening due to a lack of external funding amid sanctions.

The ratings company also left the “negative” outlook on its BB+ grade unchanged, according to a statement released on Friday. That puts Russia’s rating on par with Bulgaria and Indonesia.

S&P stripped Russia of its investment grade in January for the first time in a decade as plunging oil prices and sanctions over the conflict in Ukraine push the world’s largest energy exporter into its first recession since 2009. The penalties have locked Russian corporate borrowers out of international debt markets, spurred capital flight and weakened the country’s currency, which lost about half of its value last year before rebounding in 2015.

October 31, 2015: a reader answered one of the questions at the end of the original post. S&P downgraded Venezuela's credit rating back in September, 2014:

S&P downgraded Venezuela's rating from B-minus to triple-C-plus. The new rating indicates that there is a one-in-two chance that the South American country defaults on its sovereign debt in the next two years.

Original Post

BloombergBusiness is reporting:

Saudi Arabia’s credit rating was cut by Standard & Poor’s , which said the decline in oil prices will increase the budget deficit in a country that relies on energy exports for 80 percent of its revenue.

S&P cut the sovereign rating one level to A+, the fifth-highest classification, as it said the biggest OPEC producer’s deficit will increase to 16 percent of gross domestic product this year. The nation’s credit outlook is negative as the decline in oil prices makes it difficult to reverse the fiscal deterioration, S&P said in a statement.

“We could lower the ratings within the next two years if Saudi Arabia did not achieve a sizable and sustained reduction in the general government deficit, or its liquid fiscal financial assets fell below 100 percent of GDP,” Trevor Cullinan, a credit analyst at the rating company, said in the statement.

The Saudi Finance Ministry said it "strongly disagrees with S&P’s approach to ratings management in this particular instance." The downgrade was "driven by fluid market factors rather than changes in the fundamentals of the sovereign," which "remain strong," the ministry said in a statement on the website of state-run Saudi Press Agency.

Time to buy Saudi bonds?

I'm curious how S & P rates Venezuela and Russia.

If the S & P cuts the US credit rating, President Obama will sic the IRS on Standard and Poor's.