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As The Price Of Oil Rose, Financial Measures Of Oil And Gas Companies Benefited Aug 08
Standard & Poors, Aug 2008
Abstract
Key credit metrics of companies in the oil and gas sector have strengthened considerably in the last couple of years thanks to the uptrend in hydrocarbon prices. Rating category medians have outperformed benchmarks in all segments of the industry. It's no surprise then that upgrades outpaced downgrades during the past three years. High yield companies in the exploration and production (E&P) segment have been major beneficiaries of the higher prices because they've made these companies' relatively high cost operations sustainable. Increased E&P spending, spurred by the improved performance of upstream companies, benefited oilfield services companies as well. Higher day rates and utilization levels in the industry significantly improved overall margins, with 2006 being a record year, although 2007 saw some...
Standard and Poors RatingsXpress Credit Research provides in-depth coverage of international corporates, financial institutions, insurance companies, utilities, sovereigns and structured finance programs. RatingsXpress Credit Research lets users determine the credit rating of holdings and identify key factors underlying an issuer's creditworthiness, distinguishes the different risk exposures for new and existing deals, and provides an understanding of how their analysts interpret key regulatory, political and environmental events and their economic impact.
Research Type: Commentary
Criteria articles describe the thought process and methodology Standard & Poor's analysts use in determining ratings. These commentary pieces discuss both the quantitative (economic and financial) and qualitative (business analysis and caliber of management) aspects of the analysis, as well as legal issues.
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