Wednesday, April 27, 2016

S&P Strips ExxonMobil of Triple A Rating

ExxonMobil has been stripped of its long-held triple A rating by credit agency Standard & Poor’s.

According to S&P, the downgrade to double A plus reflected the ballooning of Exxon’s debt and analyst views that the largest US oil group and fourth-largest publicly traded American company would have to increase capital expenditure in the coming years to maintain production.

The downgrade from S&P leaves just two publicly traded US companies with triple A ratings: Microsoft and Johnson & Johnson.

Prior to the downgrade, Exxon had held its triple A status since 1930,

Exxon said in a statement: “Nothing has changed in terms of the company’s financial philosophy or prudent management of its balance sheet.”

It added that it “places a high value on its strong credit position” and was focused on creating long-term shareholder value “despite near-term market volatility”.



  1. Thank you for this post. Realistic accounts of the economic deterioration taking place are welcome. We are all aware of the inflation in risk assets, such as the stock market, which has been divorced from the real economy for some time now. The "boom" in risk may have peaked anyway.

    1. This rating change is telling us about "economic deterioration" that has occurred in the past. This suggests that the "boom" in risk for this cycle is already behind us. It offers no guide as to the future. ExxonMobile's stock price declined significantly beginning last summer and is now moving up.