Operating in a high risk country; Participation in the capital-intensive and volatile oil and gas exploration and production (E&P) industry; Weak profitability; and Leading position as an integrated oil company with a large proven reserve base. Highly leveraged credit measures in the current price environment. The negative outlook on PDVSA reflects that on Venezuela. The negative outlook reflects the heightened risk of the Venezuelan government (and its related entities) defaulting or undertaking a distressed debt exchange following the sharp fall in oil revenues. We would lower the ratings on the company if we downgrade the sovereign. Additionally, we could also lower the ratings if we see the risk of default increasing/becoming more imminent. We would lower the ratings to 'D'
