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Western Canadian crude prices have struggled for weeks, particularly compared to the price of the U.S. benchmark, West Texas Intermediate. (CBC) Global credit rating agency DBRS is warning that if Canada’s crude oil price woes drag on without improvement, it could negatively affect the credit ratings of energy companies that rely on Western Canadian oil. The Toronto-based firm said in a commentary Wednesday that while global and U.S. oil prices have dropped, Western Canadian producers have been under even "greater duress" as Canadian benchmark prices have fallen even more. Generally, integrated energy companies — those that own refineries and gas stations — have been able to weather the steep price discounts. But other, less diversified producers have struggled. If the bottlenecks making it difficult to get more oil to U.S. markets continue unabated, DBRS says producers that rely on Western Canadian energy production are at risk of "a material degradation in cash flow and resulting key credit metrics." "This has happened quickly and it is of concern," Victor Vallance, senior vice president of energy at DBRS said in an interview. "And if it stays this way for some period of time, it will likely cause us to take action […]
