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Image courtesy of Junius /Wikimedia Commons.

Ratings agency Moody’s downgraded Petrobras bonds to a junk rating Tuesday as the Brazilian oil giant faces heightened financial pressure amid a growing corruption scandal.

The agency kept its negative outlook for the company and cut its rating down to Ba2, two steps below investment grade.

Moody’s added that will “consider further developments in the ongoing investigations and the progress towards normal production of financial statements” as it continues to evaluate the bonds.

The downgrade is the second in less than a month and “reflects increasing concern about corruption investigations and liquidity pressures,” Moody’s said.

Petrobras’ mounting net debt, currently standing at about $110 billion, was also cited as a source of concern.

“Moody’s also affirms that the Company may go through challenging times in order to reduce its debt in the coming years and may need more time than previously expected to reduce its leverage,” the ratings agency said.

Fitch Ratings and Standards & Poor currently have Petrobras debt at their lowest investment grades.

Yields on $3.5 billion of Petrobras notes due in 2023 have spiked from 1.6 percent to 7 percent since November while yields on bonds due in 2021 traded at 7.31 percent yesterday, Bloomberg said.

The company currently has $52 billion of bonds on the market and has seen its market capitalization drop from $310 billion in 2009 to $45.1 billion this year.

Petrobras does not have any covenants related to rating downgrades or to losing its investment grade status.

The downgrade follows growing concerns over the size of an alleged corruption scheme that has delayed the company’s audited third quarter and annual 2014 results for months.

The scale of the corruption is still unknown although Brazilian authorities have claimed kickback and bribery schemes could have diverted anywhere between $3.7 billion to $28 billion from the company.

Former Petrobras CEO Maria das Graças Foster resigned her post along with five other executives earlier this month amid an ongoing corruption probe into the company that has already landed three former executives in jail.

Foster has said the company could face write downs of up to $31 billion for alleged bribery and kickback schemes tied to company contracts.