...Oil Shock Not Shocking: The current dramatic oil price fall is consistent with Fitch Ratings' experience of cyclical industries with long-term, capital intensive projects. Our rating approach reflects this. We hold companies to relatively tight balance sheet leverage in good times for any given rating, but in a downturn, if we expect any impairment of their credit profiles to be temporary, we will tolerate higher leverage for a period without taking any negative rating action. Rating actions have and will focus on companies most affected by the oil price fall because of weak starting profiles - Total S.A. (AA-/Stable), ENI SpA (A/Stable) - liquidity concerns, inability to make cost savings, or corporate actions - Royal Dutch Shell plc (AA/Rating Watch Negative). Action Already Being Taken: All western European oil and gas companies have set out a response to the current downturn. All are aiming for opex savings. This is a standard response to falling oil prices and underpins these companies'...
