S&P drops Forest Oil outlook

Standard & Poor's said it revised its outlook on Forest Oil Corp. to negative from stable and affirmed all of its ratings, including the BB- corporate credit rating, on the company.

"The outlook revision reflects the potential for leverage to exceed our 4x downgrade threshold in 2013," said S&P credit analyst Marc D. Bromberg in a news release.

The agency said the rating on Forest reflects the capital-intensive and cyclical nature of the E&P industry and a reserve mix that is weighted toward weak natural gas prices. Ratings also reflect the company's good liquidity, onshore geographic diversity, and the relatively low-risk nature of its drilling program.

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