The Middle East conflict is becoming a major credit risk for Asia-Pacific corporates, S&P Global Ratings said in a Thursday release.

Corporates will observe greater operational and financial constraints due to increased energy prices, supply chain disturbance, and more expensive transportation and insurance costs, S&P Asia-Pacific Corporate and Infrastructure Analytical Oversight and Consistency Council chair Simon Wong said.

Aside from initially hit sectors such as downstream refiners, petrochemicals, airlines, shipping, and utilities, the credit impact will spread to mining, logistics, transportation, retail, semiconductors, and agriculture, according to Wong.

About 82% of S&P's rating firms in the region are investment grade, which shows strong balance sheets and liquidity buffer that could anchor near-term volatility in oil and gas prices amid reliance on the Middle East for gas.

Credit quality could deteriorate faster under weaker funding conditions and higher risk premiums and dampened confidence that could hit liquidity and financing, S&P said.