Chevron, Shell, and Total See Credit Ratings Slashed
By Nick Cunningham
OilPrice.com
Mon, 11 April 2016
In a move that shows not even the largest oil companies are well-positioned during the oil price downturn, Moody’s Investors Service downgraded the credit ratings of three oil majors on Friday.
Moody’s cut the credit ratings of Chevron and Royal Dutch Shell by one notch, and cut the credit rating of French oil giant Total by two levels.
Both Chevron and Shell were downgraded to Aa2 from Aa1.
“The downgrade of Chevron to Aa2 reflects our expectations of negative free cash flow and rising debts levels caused by low oil prices in 2016 and 2017,” Pete Speer, Moody’s Senior Vice President, said in a statement. “The stable outlook is supported by the company’s increasing capital spending flexibility and scope for operating cost reductions, which combined with modest rises in commodity prices should allow Chevron to substantially reduce negative free cash flow in 2017 and stabilize its debt levels and corresponding financial leverage as measured against capitalization and proved reserves.”
The Rest…HERE
