This site uses cookies to provide you with a great user experience. By using BondbloX, you accept our use of cookies.
Bond Market News
Petroperu Downgraded to Caa1 by Moody’s
January 29, 2026
Petroleos del Peru (Petroperu) was downgraded by a notch to Caa1 from B3 by Moody’s. The downgrade reflects concerns that measures under Emergency Decree No. 010-2025, including possible asset segmentation or transfers, are credit negative, potentially weakening Petroperu’s asset base, increasing governance and execution risks, and undermining creditor protections, especially around the Talara refinery. The rating agency also highlighted Petroperu’s severely weak liquidity, with just $33.9mn in cash as of September 2025 versus about $400mn in annual interest obligations, alongside negative operating cash flow, high leverage ($6.3bn debt), negative interest coverage, and reliance on short-term refinancing and extraordinary government support. While EBITDA turned positive in 3Q25, Moody’s views this as insufficient to offset structural weaknesses. The Caa1 rating incorporates three notches of sovereign support uplift, reflecting a high likelihood of government backing, though such support has historically been reactive. The negative outlook stems from uncertainty around future government support, execution risks tied to restructuring and asset transfers, ongoing liquidity stress, and limited refinancing flexibility.
Its 5.625% 2047s was trading stable at 68.8, yielding 8.9%.
Go back to Latest bond Market News
Related Posts:
BondbloX Pte. Ltd. is regulated by the Monetary Authority of Singapore as a Recognised Market Operator ("RMO") and exempted from Section 49(1) of the Securities and Futures Act (Cap. 289) ("SFA") under Section 49(7) of the SFA.