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ARCHIVE | Criteria | Corporates | Industrials: Standard & Poor's Oil And Gas Pricing Assumptions: Short Term Lowered Again, But Long-Term Factors Still Supportive Jan 09
Standard & Poors, Jan 2009
Abstract
With recessionary expectations becoming globally broader, deeper, and longer than anticipated, hydrocarbon prices have continued their relentless decline. Indeed, West Texas Intermediate has declined 74% from a closing high of $145.31/bbl in early July 2008 to $37.77/bbl on Jan. 16, 2009. Also, Henry Hub spot natural gas prices have fallen to less than $5/mmBTU from a high of $13/mmBTU in June. After recently revising our pricing assumptions on Dec. 3, 2008, Standard & Poor's Rating Services again lowered its short-term working assumptions to reflect the current market view. We also again left long-term assumptions unchanged to recognize supportive long-term fundamentals (see tables 1 and 2). Our short-term pricing assumptions for West Texas Intermediate (WTI) oil and Brent are now $40/bbl...
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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