Fitch: Dependence on Russian gas affects Austria’s rating

Austria is threatened by more expensive loans because of its continued heavy dependence on Russian gas. Ratings agency Fitch this evening confirmed Austria’s second-highest rating of “AA+”, but with a persistent negative outlook. The credit watchdog warned that Austria remains “exposed to significant long-term risks with respect to Russian gas imports”.

Specifically, Fitch fears the negative financial implications of terminating its long-term gas supply contracts. These risks are all the more significant because Austria already has a high level of national debt and its current credit rating leaves little room for “further shock cushioning”. The turquoise-green government lacks a clear strategy on how to achieve the national and EU goal of ending dependence on Russian gas by 2027, and how to align this with the long-term contract with Gazprom, which runs until 2040 ”.

Fitch had lowered Austria’s credit outlook from stable to negative last October, and even then it had indicated heavy reliance on Russian gas. Fitch Ratings is somewhat more optimistic about the economic outlook this year than it was in the fall. Economic growth will be 0.4 percent, which is linked, among other things, to lower energy prices and improvements in the field of supply chain.