S&P downgrades Venezuela

Standard & Poor’s said it lowered its long-term foreign and local currency sovereign credit ratings on the Bolivarian Republic of Venezuela to CCC from CCC+.

The outlook on both long-term ratings is negative.

S&P also affirmed the C short-term foreign and local currency ratings. In addition, S&P lowered its transfer and convertibility assessment on the sovereign to CCC from CCC+.

Prices for crude oil in spot and futures markets have fallen by about 60% since June 2014, leading S&P to revise down its oil price assumptions significantly.

When S&P last reviewed Venezuela, in September 2014, the agency expected Brent oil prices to average $105 per barrel in 2015 and $100 in 2015-2018. S&P now assumes an average Brent oil price of $55 per barrel in 2015 and $70 per barrel in 2015-2018.

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