Russia’s debts are expected to collapse soon, according to a top ratings agency, which downgraded the country’s bonds deeper into “junk” territory.

Just days after downgrading Russia from investment status, Fitch Ratings reduced its estimate of the country to near the bottom of its scale.

It’s the latest setback for the country’s credit rating following its invasion of Ukraine.

Moscow indicated this week that sanctions might impair its bond payments.

“Further tightening of sanctions, as well as initiatives to curtail energy exports, raise the likelihood of Russia responding with at least selective non-payment of its sovereign debt obligations,” Fitch warned.

Fitch’s move comes after the United States and the United Kingdom announced plans to restrict Russian oil as part of a stepped-up economic reaction to the invasion of Ukraine.

The measure, according to US President Joe Biden, is aimed at “the primary artery of Russia’s economy.”

Meanwhile, the European Union has said that it would no longer rely on Russian gas.

The sanctions are intended to hammer Moscow’s finances as a major energy exporter, but analysts warn that the price of oil and natural gas would certainly rise on world markets as a result.

Moscow assured investors on Sunday that it will continue to service its sovereign debt.

It did, however, warn that international sanctions on its oil sector might limit its ability and desire to uphold its obligations.

The finance ministry stated in a statement that “the real feasibility of providing such payments to non-residents would rely on the restrictive measures adopted by foreign nations in connection to the Russian Federation.”

If Russia defaults on its debt payments, it will be the first big default on the country’s sovereign obligations since the Bolshevik revolution of 1917.

Rival rating agencies Moody’s Investors Service and S&P Global Ratings have both lowered their estimates of Russian government debt in recent days.

Three of the world’s main rating agencies now consider the country’s sovereign debt to be below investment grade, or in “junk” territory.

S&P stated that the move was prompted by steps that it considered would “significantly enhance the risk of default.”

A default on Russian debt was “essentially already occurring,” according to Shane Oliver of investment management firm AMP Capital.

“It will only be serviced in devalued roubles, and foreign investors are selling it at bargain basement rates. Fortunately, worldwide exposure to it is somewhat limited “He informed reporters about it.

The Russian rouble has also dropped to new lows as governments across the world tighten their sanctions against the country.

Last month, Russia’s central bank more than doubled its interest rate to 20% in an effort to keep the value of the country’s currency from falling much worse.

Due to the invasion of Ukraine, dozens of major businesses, including McDonald’s, Coca-Cola, and Starbucks, have ceased operations in Russia.