LONDON -Credit ratings agency Fitch has downgraded its rating on Saudi Arabia in light of the fall in oil prices, which it says will have "major negative implications" for the country's financial position.
In a note Tuesday, Fitch said it's reducing its rating on the oil-rich kingdom by one notch to AA- from AA. It also kept its outlook view on the country at "negative," which means that another downgrade is possible.
The downgrade is largely due to Fitch's decision to cut its oil price assumptions for this year and next to $35 a barrel and $45 a barrel. As a result, Fitch expects Saudi Arabia's deficit to widen.
Fitch also warned that the geopolitical risks facing Saudi Arabia are "high relative" to its peers with similar ratings.