OREANDA-NEWS. Fitch Ratings' sector outlook for the Latin American Oil and Gas Industry is negative for 2015, driven by the cash flow pressure due to lower crude prices.

'The substantial drop in oil prices has more negatively impacted high-yield Exploration and Production (E&P) and energy service issuers, such as Pacific Rubiales Energy Corp. (Pacific Rubiales, Issuer Default Rating 'BB+'/Stable Outlook) and GeoPark Latin America Limited Agencia en Chile (GeoPark, IDR 'B'/Negative Outlook),' according to Xavier Olave, an Associate Director at Fitch Ratings. 'These companies will be forced to significantly curtail capex to preserve cash flow, but the curtailment of expenses to preserve cash flow could have a longer-term detrimental effect on the companies' reserve life.'

Fitch has published a report highlighting the questions most frequently raised, as well as the agency's views, on the potential credit implications for LatAm E&P and services companies due to the drop in crude oil prices. In addition to the direct impact on energy companies, the report addresses the direct impact, both positive and negative, on a multitude of countries/industries/issuers in the region.

The full report 'What Investors Want to Know: Oil Drop Effect on LatAm' is available at 'www.fitchratings.com'.