* Moody's puts 120 energy firms, 55 miners under review
* Sees slow recovery for commodities
* Cuts Brent, WTI price forecast to $33/bbl in 2016
* Expects to conclude energy review by end of Q1 (Adds details of mining sector review)
By Ron Bousso
LONDON, Jan 22 (Reuters) - Moody's has placed 175 oil, gas and mining companies on review for a downgrade due to a prolonged rout in global commodities prices that it says could remain depressed for some time.
Warning of possible downgrades for 120 energy companies, the rating agency said there was a "substantial risk" of a slow recovery in oil that would compound the stress on firms already pummelled by a 75 percent drop in prices since June 2014.
It said it was likely to conclude the review by the end of the first quarter which could include multiple-notch downgrades for some companies, particularly in North America.
A ratings downgrade makes borrowing more expensive for companies.
Moody's also cut its oil price forecasts. In 2016, it now expects the global benchmark Brent crude and the West Texas Intermediate (WTI) crude, the North American benchmark, to average $33 a barrel. This marks a $10 a barrel cut for Brent from its previous forecast and a $7 a barrel reduction for WTI.
Both contracts are expected to rise by $5 a barrel on average in 2017 and in 2018.
The sweeping global review includes all major regions and ranges from the world's top international oil and gas companies such as Royal Dutch Shell RDSa.L and France's Total TOTF.PA to 69 U.S. exploration and production (E&P) and services firms.
It nevertheless does not include the two top U.S. oil companies ExxonMobil XOM.N and Chevron (N:CVX) CVX.N .
"We see a substantial risk that prices may recover much more slowly over the medium term than many companies expect, as well as a risk that prices might fall further," Moody's said.
The reviews reflect not only oil prices falling to their lowest since 2003 but also weakening global demand and a prolonged period of oversupply that will "significantly stress the credit profiles of companies in the oil & gas sector."
"Even under a scenario with a modest recovery from current prices, producing companies and the drillers and service companies that support them will experience rising financial stress with much lower cash flows," it said.
Energy companies' balance sheets and share prices have been hammered by one of the sector's worst downturns in decades, leading so far to a relatively limited number of bankruptcies.
Oil, gas and mining companies have been forced to cut thousands of jobs, scrap new projects and slash spending.
Rival credit rating agency Standard & Poor's signalled in an interview on Friday that oil-exporting countries also face fresh downgrades and that it could repeat last year's move when it made a big group of cuts all at once. one of the steepest price falls in history, crude oil prices LCOc1 have lost some 75 percent since mid-2014 to near $30 per barrel as producers around the world pump 1 million to 2 million barrels of oil every day in excess of demand in a war of discounts for market share. O/R
Multi-notch downgrades are particularly likely among issuers whose activities are centred in North America, where natural gas prices have declined dramatically along with oil prices, Moody's said.
UNPRECEDENTED SHIFT
Moody's also placed 55 mining companies on review for downgrade as they battle a slump in commodity prices due to oversupply and slowing growth in China. believes that this downturn will mark an unprecedented shift for the mining industry. Whereas previous downturns have been cyclical, the effect of slowing growth in China indicates a fundamental change that will heighten credit risk for mining companies."
Commodities trader Glencore 's GLEN.L credit rating was last month downgraded to one notch above junk status by Moody's which cited likely weak mining market conditions over the next two years.