S&P Global Ratings on March 23 affirmed Chevron Corp.'s long-term issuer credit rating and senior unsecured issue-level rating at AA but revised its outlook on the oil supermajor to negative from stable.

The negative outlook on Chevron reflects its weaker-than-expected financial performance in 2020, under Ratings' revised oil and natural gas price assumptions, including funds from operations to debt of less than 60% and debt to EBITDA of more than 1.5x as well as the potential of a downgrade if the oil supermajor's credit measures do not improve next year. Ratings said it expects Chevron's financial measures to be weak for the current rating in 2020.

The rating agency recently dropped its 2020 West Texas Intermediate oil price assumption to $25 per barrel, from $35/bbl, and its Brent oil price assumption to $30/bbl, from $40/bbl. Ratings' decision comes as oil markets are forecast to be "heading into a period of a severe supply-demand imbalance" in the second quarter.

This S&P Global Market Intelligence news article may contain information about credit ratings issued by S&P Global Ratings. Descriptions in this news article were not prepared by S&P Global Ratings.