REFILE-UPDATE 1-Fitch downgrades Saudi Arabia on rising geopolitical risk

Rating agency Fitch downgraded Saudi Arabia's credit rating to A from A+ on Monday, citing rising geopolitical and military tensions in the Gulf and a deterioration of the kingdom's fiscal position.

The downgrade – which places Saudi Arabia one notch above the assessment of peer rating agency S&P Global – is a blow to the largest Arab economy just as it is gearing up for a potential international sale of U.S. dollar-denominated Islamic bonds. It follows an unprecedented attack on Saudi oil plants on Sept. 14 which initially halved the crude production of the world's largest oil exporter.

"Recent drone and missile attacks on Saudi Arabia's oil infrastructure resulted in the temporary suspension of more than half of the country's oil production," Fitch said on Monday. "Although oil production was restored fully by end-September, we believe that there is a risk of further attacks on Saudi Arabia, which could result in economic damage."

Also Read: Fitch downgrades Saudi Arabia's on rising geopolitical risk