Fitch Ratings revised Ecopetrol’s outlook from stable to negative on March 17, 2025, while maintaining its BB+ credit rating. The adjustment mirrors Fitch’s earlier modification of Colombia’s sovereign outlook on March 6.
It reflects the inherent credit risk connection between the state-owned oil company and the Colombian government. The rating agency emphasized that Ecopetrol’s close relationship with the Colombian state significantly influenced this decision.
The government retains its position as the principal shareholder of Colombia’s largest company, which employs over 19,000 people across the Americas. Ecopetrol controls 100% of Colombia’s refining capacity and dominates the national hydrocarbon sector.
The company plays a pivotal role in Colombia’s energy landscape, managing most transportation, logistics, and refining systems while holding strong positions in petrochemicals and gas distribution.
Fitch highlighted the correlation between sovereign ratings and state-affiliated enterprises. Similar outlook revisions affected other Colombian companies with government participation, including ISA and Grupo de Energía de Bogotá.
Fitch Downgrades Ecopetrol’s Outlook to Negative Following Colombia’s Sovereign Rating Change. (Photo Internet reproduction)
The revision occurs against a backdrop of challenging macroeconomic conditions. Colombia’s economy expects 2.5% growth in 2025 and 2.9% in 2026, with inflation continuing its downward trend.
Colombia’s Current Account Deficit and Ecopetrol’s Outlook
However, the current account deficit will likely widen to 2.7% of GDP this year and 3.1% in 2026. Exchange rate projections place the Colombian peso at 4,350 per dollar by year-end, a slight strengthening from current levels.
This rate environment will influence Ecopetrol’s international operations and financial planning. The outlook change marks a significant shift from previous evaluations.
Fitch had consistently maintained Ecopetrol‘s BB+ rating with a stable outlook throughout 2024, acknowledging the company’s solid financial profile and strategic importance to Colombia.
Ecopetrol must now navigate these new financial headwinds while implementing strategies to strengthen market confidence. The company’s future rating will largely depend on Colombia’s economic trajectory and government decisions aimed at enhancing fiscal stability.
Fitch concluded that Colombia’s fiscal policies and economic performance will determine whether Ecopetrol can avoid further rating deterioration in the coming months.