Fitch downgrades Citgo

Fitch Ratings said it downgraded the issuer default ratings for Citgo Petroleum Corp. to B from BB- and downgraded its senior secured ratings to BB with a recovery rating of RR1 from BB+.

The downgraded ratings include Citgo’s senior secured credit facility to BB with recovery rating of RR1 from BB+, secured term loans to BB with recovery rating of RR1 from BB+, secured notes to BB with recovery rating of RR1 from BB+ and fixed-rate IRBs to BB with recovery rating of RR1 from BB+.

The outlook also was revised to stable from negative.

The downgrades follow the downgrade of CITGO’s ultimate parent, Venezuelan National Oil Co. Petroleos de Venezuela (Pdvsa) from B to CCC at the end of December.

The ratings are supported by the scale and quality of the company’s refining assets with three high-complexity refineries consisting of about 749,000 barrels per day of refining capacity on the Gulf Coast and Mid-continent, Citgo said.

These positives are balanced by Citgo’s strong operational linkage to indirect parent Pdvsa and use of Citgo to upstream dividends to its parent, the agency said.

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