Noble's financial flexibility compromised as it loads up on short-term debt: Fitch

It will focus on short term debt to lower financing costs.

Asia's largest commodity trader will grapple with reduced financial flexibility as it focuses on securing more short-term loans from creditors, according to Fitch Ratings.

Fitch said that Noble will secure more short-term loans in order to keep financing costs low amid a difficult operating environment.

"This will increase the risk profile of the company, reduce its financial flexibility and potentially put strain on its senior unsecured debt level," Fitch said.

As a result, Fitch has placed Noble's debt ratings on negative watch.

"The [negative watch] will be resolved when Noble completes refinancing of its committed bank facilities, which is due in May, and on the announcement of its 1Q16 results. The resolution will also reflect our revised assessment of Noble, which will take into account the current weak operating environment, its focus on short-term debt financing in the future and its improved balance-sheet structure after it repays debt due in the short term," Fitch said.