Lower Oil Price Assumptions Prompt Rating Actions On Six Major European Integrated Oil And Gas Companies

We updated our oil price assumptions on Jan. 12, revising down Brent prices to $40 per barrel (/bbl) for the remainder of 2016, $45/bbl in 2017, and $50/bbl thereafter. We now believe many major oil and gas companies' current and prospective core debt coverage metrics are likely to remain below our rating guidelines for two or three years as the industry adjusts to lower prices. We are therefore taking rating actions on six parent companies of major European oil and gas groups. We are lowering our ratings on Royal Dutch Shell PLC to 'A+/A-1' and placing the long-term rating on Shell and the ratings on five other companies on CreditWatch with negative implications. We see a significant likelihood of one-notch

...+ We updated our oil price assumptions on Jan. 12, revising down Brent prices to $40 per barrel (/bbl) for the remainder of 2016, $45/bbl in 2017, and $50/bbl thereafter. + We now believe many major oil and gas companies' current and prospective core debt coverage metrics are likely to remain below our rating guidelines for two or three years as the industry adjusts to lower prices. + We are therefore taking rating actions on six parent companies of major European oil and gas groups. We are lowering our ratings on Royal Dutch Shell PLC to 'A+/A-1' and placing the long-term rating on Shell and the ratings on five other companies on CreditWatch with negative implications. + We see a significant likelihood of one-notch downgrades for several Europe-based integrated majors when we resolve the CreditWatch placements. We anticipate doing this within about two weeks of companies announcing annual results. LONDON (Standard & Poor's) Feb. 1, 2016--Standard & Poor's Ratings Services said today that...

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