REUTERS BOND NEWS UPDATE - Moody's, S&P say may cut Shell ratings
Fri January 9, 2004 04:11 PM ET
NEW YORK, Jan 9 (Reuters) - Moody's Investors Service and Standard & Poor's on Friday said they may cut the top ratings for Royal Dutch/Shell Group (RD.AS: Quote, Profile, Research) (SHEL.L: Quote, Profile, Research) , after Shell on Friday cut by 20 percent its estimates of how much oil and gas it was certain it could profitably extract from its fields.
Investors reacted to Shell's announcement by criticizing management and punishing the company's share price, which fell more than 7 percent.
Both Moody's and S&P affirmed their short-term ratings for Shell.
But Moody's said it may cut the group's "Aaa" long term ratings, while S&P said it may cut the group's "AAA" ratings, which in both cases are the highest possible ratings.
Many western oil companies are struggling to find new oilfields to replace maturing ones, which is crucial to assuring future earnings growth.
But in recent years, investors have perceived Shell as lagging in adding new fields.
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