Research Update: Exxon Mobil Corp. Downgraded To 'AA' As Lower Oil Price Assumption Weakens Cash Flow/Leverage Metrics; Outlook Negative

U.S.-based integrated oil company Exxon Mobil Corp.'s cash flow/leverage measures fell well below our expectations for the rating in 2019, and with lower oil and natural gas prices, low refining margins and weak chemicals demand anticipated over the next two years, we expect measures to remain weak without a significant change in the company's financial plans. We have revised our estimates to reflect the recent reduction in our crude oil and natural gas price deck assumptions. As a result, we are lowering our issuer credit rating and unsecured debt ratings on ExxonMobil to 'AA' from 'AA+'. Our negative outlook reflects the potential for a further downgrade if the company does not take adequate steps to improve cash flows and leverage

...- U.S.-based integrated oil company Exxon Mobil Corp.'s cash flow/leverage measures fell well below our expectations for the rating in 2019, and with lower oil and natural gas prices, low refining margins and weak chemicals demand anticipated over the next two years, we expect measures to remain weak without a significant change in the company's financial plans. - We have revised our estimates to reflect the recent reduction in our crude oil and natural gas price deck assumptions. - As a result, we are lowering our issuer credit rating and unsecured debt ratings on ExxonMobil to '##' from '##+'. - Our negative outlook reflects the potential for a further downgrade if the company does not take adequate steps to improve cash flows and leverage over the next 12 to 24 months, in order to bring funds from operations (FFO)/debt closer to 60% and debt to EBITDA to about 1.5x for a sustained period....

Research Update