The global push to limit climate change is expected to cut demand for coal, oil and gas, and the infrastructure required to get them out of the ground, turning them into ‘stranded assets’ that will never be fully utilised.
“A simulation on FitchRatings’ Sovereign Rating Model (SRM) suggests the fairly direct effects could lead to a fall in the SRM output by around one rating notch by 2040 and two to three notches by 2050 for a major oil exporter,” Fitch’s report said.
The 20 sovereigns with the highest ratio of net fossil fuel exports-to-GDP suffered a median net downgrade of 1.6 notches from 2015-2020. But two defaulted and a further three were downgraded by at least four notches, Fitch added.
Source: Economy - investing.com
