IEEFA – European Oil: Navigating Credit Risk Towards Net Zero, Mar 2025

The main theme of the report is the assessment of credit risks of European oil companies in the context of transitioning to carbon neutrality.

Key findings include uneven application of energy transition factors, inadequacy of credit rating horizons amidst structural decline in the oil industry, long-term credit outlook providing market stability amidst existential risks, climate scenarios and policies aiding better risk assessment in the sector, necessity of explicit consideration of energy transition factors in sector assessment methodologies, improvement in risk integration requiring formal consideration of non-oil and gas business profiles, assessment of transition plans as a basis for credit analysis, and rethinking investments, capital requirements, and financial policies in the context of oil and gas company credits.