S&P tells Industrial Minerals that low oil prices are unlikely to dent project finance ratings, for now

Since oil prices started to tumble a year ago, many have speculated about the impact low energy prices will have on project developments. To understand the outlook from a credit rating perspective, Industrial Minerals speaks to Karim Nassif, a credit analyst at Standard & Poor’s. He explains that the current low price of crude oil and natural gas “is unlikely to have a widespread impact on the credit quality of global project finance debt over the next 18 months”. He justifies this view by highlighting that while the price plummet has affected a few companies, most have strategies in place to protect them from sudden market changes, with some companies even benefiting from the slump. While the situation seems manageable for now, Nassif warns that the story could be very different if prices were continue to fall.

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