Fitch lowers Rio Oil Finance

Fitch Ratings said it downgraded Rio Oil Finance Trust’s $2 billion series 2014-1 notes to BB+ from BBB-, along with its R$2.4 billion series 2014-2 special indebtedness interests to AAsf(bra) from AAAsf(bra) and $1.1 billion series 2014-3 notes to BB+ from BBB-.

Fitch also said it assigned a negative outlook to all of the issuances, which were on Rating Watch negative prior to the downgrades.

The downgrades are a result of the continued downturn in oil prices and the impact on debt-service coverage levels, the agency said.

The negative outlook reflects the impact lower oil prices may have on future production levels, which further impacts debt-service coverage levels, Fitch said.

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