We expect Tulsa, Okla.-based oil and gas exploration and production (E&P) company Laredo Petroleum Inc.'s (LPI) credit metrics to weaken over the next two years given the recent drop in commodity prices. We have revised our estimates to incorporate the recent reduction in our crude oil and natural gas price deck assumptions. As a result, we are lowering our issuer credit rating on Laredo to 'B-' from 'B+'. The outlook is negative. Our negative outlook reflects the potential for a further downgrade if the company underperformed expectations or if we believed there was a heightened probability of conventional or selective default. The sharp decline in commodity prices will cause Laredo's credit metrics and profitability to deteriorate below our previous expectations
