Fitch cuts Western Midstream

Fitch Ratings said it downgraded Western Midstream Operating, LP’s (WES)) and its senior unsecured rating from BB+ to BB. The senior unsecured notes have a Recovery Rating of RR4, which implies an average recovery in the event of default. The ratings remain on rating watch negative.

“The downgrade and negative watch is primarily driven by Fitch’s negative rating action of its general partner and major counterparty, Occidental Petroleum Corp. (OXY; BB-/RWN). OXY is expected to contribute approximately 60%-65% of WES’ revenue in 2020. Fitch previously stated a negative rating action at OXY would be a trigger for negative rating action for WES,” the agency said in a press release.

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