S&P cuts Oceaneering

S&P said it downgraded Oceaneering International Inc. and its senior unsecured notes to B+ from BB.

“We expect demand for the oilfield services sector will be hurt by the collapse in oil prices. Following the drop in oil prices, E&P companies have announced material reductions to capital spending and activity plans, which will translate to less demand for oilfield services. We expect the offshore sector will see a sharp decline in exploration activity, postponements in reaching final investment decisions (FIDs) on new projects and delayed starts to certain projects that had already been sanctioned,” S&P said in a press release.

“Furthermore, offshore producers will likely remain more cautious in their willingness to commit capital to longer-term projects until macroeconomic fundamentals are more stable, which could slow any improvement in Oceaneering's revenues, margins and credit measures, the agency said.

The outlook is negative.

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