Core Viewpoint - Ecopetrol S.A. is facing a proposed tax adjustment and penalty from the Colombian Tax and Customs Authority (DIAN) amounting to COP 1.2 trillion, plus estimated interest of COP 0.5 trillion, related to VAT on diesel fuel imports from 2022 to 2024 [1][2]. Group 1: Tax and Customs Issues - On June 3, 2025, DIAN notified Ecopetrol of Special Customs Requirement No. 525, indicating its intention to issue an official adjustment assessment related to VAT on diesel fuel imports [1]. - Ecopetrol formally opposed the proposed tax adjustment and penalty in its response submitted on July 1, 2025, highlighting differing legal interpretations between DIAN and the Company [2]. - Since January 2025, Ecopetrol has been making VAT payments on diesel and gasoline imports at a 19% rate, which does not affect its right to challenge DIAN's interpretation [3]. Group 2: Company Overview - Ecopetrol is the largest company in Colombia and a major integrated energy company in the Americas, employing over 19,000 people [5]. - The Company is responsible for more than 60% of Colombia's hydrocarbon production and holds leading positions in petrochemicals and gas distribution [5]. - Ecopetrol has expanded its operations internationally, with drilling and exploration activities in the United States, Brazil, and Mexico, and holds significant positions in power transmission in Brazil, Chile, Peru, and Bolivia [5].

Core Viewpoint - Ecopetrol S.A. has received authorization from the Financial Superintendency of Colombia to amend its bond issuance program, aligning it with the company's decarbonization and energy transition strategy while expanding capital market alternatives [1][2]. Group 1: Bond Issuance Program - The amendment formalized through Addendum No. 5 will be incorporated into the prospectus of Ecopetrol's local public bonds and commercial paper [2]. - Since the initial bond issuance in August 2013, totaling COP 900 billion, no additional issuances have occurred, allowing for potential future issuances up to COP 2.1 trillion [3]. - The company will inform the market of any future issuances under the program [3]. Group 2: Company Overview - Ecopetrol is the largest company in Colombia and a major integrated energy company in the Americas, employing over 19,000 people [4]. - The company is responsible for over 60% of Colombia's hydrocarbon production and holds leading positions in petrochemicals and gas distribution [4]. - Ecopetrol has expanded its operations internationally, with interests in strategic basins in the U.S., Brazil, and Mexico, and holds significant positions in power transmission in Brazil, Chile, Peru, and Bolivia [4]. Group 3: New Bond Features - The updated program will allow for the issuance of local public bonds linked to sustainable performance, including green, social, sustainable, and blue bonds [6]. - It will also enable bonds that allow in-kind payments by investors and the reopening of previous bond issuances [6]. - Additional features include bonds indexed to the UVR (Real Value Unit) and TRM (Representative Market Exchange Rate), as well as securities allocation through a book-building process [6].

Core Viewpoint - Ecopetrol S.A. has received an affirmation of its global credit rating at Ba1 with a stable outlook from Moody's, reflecting its strong position in the oil and gas sector in Colombia and Latin America [1][2]. Group 1: Credit Rating and Financial Strength - Moody's Ba1 global rating indicates Ecopetrol's leading role as Colombia's primary oil and gas producer and its significant power transmission operations [2]. - The global rating is three notches above the standalone rating due to government support through the phase-out of fuel subsidies and improved liquidity from reduced accounts receivable related to the Fuel Price Stabilization Fund (FEPC) [3]. - The standalone rating highlights the stability of Ecopetrol's cash flow, bolstered by its power transmission subsidiary (ISA) and midstream affiliates, which contributed 18% to EBITDA in 2024 [4]. Group 2: Company Overview and Operations - Ecopetrol is the largest company in Colombia, responsible for over 60% of the country's hydrocarbon production and holding key positions in petrochemicals and gas distribution [4]. - The company has a 51.4% stake in ISA, engaging in energy transmission and managing real-time systems, along with road concessions [4]. - Internationally, Ecopetrol operates in strategic basins across the Americas, including the Permian basin and the Gulf of Mexico, and holds significant positions in power transmission in Brazil, Chile, Peru, and Bolivia [4].

Core Points - Ecopetrol has successfully extended the agreement with JPMorgan Chase Bank N.A. to reduce conversion fees for ADR issuance and cancellation by 50%, now valid through December 31, 2025 [1] - The initiative has received positive market reception, prompting Ecopetrol to ensure its continuation to support investor interests [2] Company Overview - Ecopetrol is the largest company in Colombia and a major integrated energy company in the Americas, employing over 18,000 people [2] - The company is responsible for over 60% of Colombia's hydrocarbon production and holds leading positions in petrochemicals and gas distribution [2] - Ecopetrol has acquired 51.4% of ISA's shares, expanding its involvement in energy transmission and other sectors [2] - Internationally, Ecopetrol has operations in strategic basins in the U.S. (Permian basin and Gulf of Mexico), Brazil, and Mexico, and holds significant positions in power transmission in Brazil, Chile, Peru, and Bolivia [2]

Investment Rating - The report provides a "Neutral" rating for BP and Eni, while it assigns a "Buy" rating to Chevron, ExxonMobil, Shell, TotalEnergies, GALP, OMV, and Cenovus Energy, indicating a positive outlook for these companies [10]. Core Insights - The report highlights that the global oil and gas sector is expected to experience a compound annual growth rate (CAGR) of 6.5% from 2024 to 2027, driven by increasing demand and recovering prices [10]. - The Brent front month price is projected to stabilize around $65.99 per barrel in 2025, while WTI is expected to be at $62.13 per barrel, reflecting a recovery from previous lows [7]. - Refining margins are anticipated to fluctuate, with European composite margins expected to average around $5.00 per barrel in 2025, indicating a challenging environment for refiners [7]. Summary by Sections Company Ratings and Projections - BP: Current price at 393.0, target price 400, with a 2% upside and a Neutral rating [10] - Chevron: Current price at 148.19, target price 177, with a 19% upside and a Buy rating [10] - ExxonMobil: Current price at 113.19, target price 130, with a 15% upside and a Buy rating [10] - Shell: Current price at 2,698, target price 2,900, with a 7% upside and a Buy rating [10] - TotalEnergies: Current price at 54.90, target price 60.0, with a 9% upside and a Buy rating [10] - Eni: Current price at 14.26, target price 13.0, with a -9% downside and a Neutral rating [10] - Cenovus Energy: Current price at 14.64, target price 25, with a 71% upside and a Buy rating [10] Market Assumptions - The report outlines macro assumptions for commodity prices, with Brent and WTI prices expected to stabilize in 2025 [7]. - The report also discusses refining margins, indicating a challenging environment for refiners with European margins projected at $5.00 per barrel [7]. Performance Metrics - The report includes performance metrics such as EV/DACF, FCF yield, and P/E ratios for major oil companies, providing a comprehensive view of their financial health and market positioning [10].

Company Overview - Ecopetrol is a Colombian-integrated oil company involved in exploration, production, transportation, and refining of fossil fuels [1] - The company's primary operating basins are located in Colombia and Ecuador, with additional interests in Brazil and the United States [1] Investment Focus - The company is characterized by sustained free cash flows, low levels of leverage, and sustainable debt over time [1] - It targets companies in distress with high recovery potential, particularly in the oil & gas, metals, and mining sectors [1] - The focus is on emerging markets that exhibit high margins and present good medium to long-term investment opportunities [1] Shareholder Value - The company maintains a solid pro-shareholder attitude, with ongoing buyback programs and dividend distributions [1]

Investment Rating - The report provides a "Buy" rating for Chevron, ExxonMobil, Shell, TotalEnergies, GALP, OMV, and Cenovus Energy, while BP and Eni are rated as "Neutral" [10]. Core Insights - The report highlights a positive outlook for major oil companies, driven by expected increases in free cash flow and production growth rates. The average expected production growth for 2025-2027 is projected at 7% for the global sector [10]. - The report emphasizes the importance of refining margins, with European composite margins expected to stabilize around 5.00 in 2025, while US composite margins are projected to be around 15.67 [7][10]. - The macroeconomic assumptions indicate a gradual recovery in commodity prices, with Brent crude oil expected to average $65.99 per barrel in 2025, reflecting a slight increase from previous years [7]. Summary by Relevant Sections Company Ratings - BP: Current price at 380.7, target price 400, with a 5% upside, rated as Neutral (CBE) [10]. - Chevron: Current price at 144.97, target price 177, with a 22% upside, rated as Buy (CBE) [10]. - ExxonMobil: Current price at 109.73, target price 130, with an 18% upside, rated as Buy (CBE) [10]. - Shell: Current price at 2,615, target price 2,900, with an 11% upside, rated as Buy (CBE) [10]. - TotalEnergies: Current price at 54.74, target price 60, with a 10% upside, rated as Buy (CBE) [10]. - Eni: Current price at 13.86, target price 13.0, with a -6% downside, rated as Neutral (CBE) [10]. - Cenovus Energy: Current price at 14.42, target price 25, with a 73% upside, rated as Buy [10]. Financial Metrics - The report provides various financial metrics for the companies, including EV/DACF, FCF Yield, and P/E ratios, indicating strong financial health and potential for growth in the coming years [10]. - The average expected free cash flow yield for the sector is projected at 7.4% for 2025, reflecting robust cash generation capabilities [10]. Market Trends - The report notes a trend towards increased investment in renewable energy sources among major oil companies, which may impact their long-term strategies and market positioning [10]. - The refining sector is expected to see improvements in margins, particularly in the US and Europe, as demand recovers post-pandemic [7][10].

Core Viewpoint - S&P Global Ratings has maintained Ecopetrol's global credit rating at BB+ with a negative outlook, while also lowering its Stand Alone Credit Profile (SACP) rating from bbb- to bb+ due to lower oil prices and exchange rate volatility impacting financial performance [1][2]. Group 1: Financial Performance - Ecopetrol's debt/EBITDA ratio is expected to remain above 2.0, indicating ongoing financial pressure [2]. - The company has faced challenges from lower oil prices and exchange rate fluctuations over the past year [2]. Group 2: Strategic Positioning - S&P highlighted Ecopetrol's strategy focused on growth prospects, reserve replenishment, and strengthening its investment portfolio through business diversification and profitability margins [2]. - Ecopetrol is the largest company in Colombia, responsible for over 60% of the country's hydrocarbon production, and holds leading positions in petrochemicals and gas distribution [3]. Group 3: Operational Scope - The company has expanded its operations through the acquisition of 51.4% of ISA's shares, participating in energy transmission and various infrastructure projects [3]. - Ecopetrol has international drilling and exploration operations in the United States (Permian basin and Gulf of Mexico), Brazil, and Mexico, and holds significant positions in power transmission in Brazil, Chile, Peru, and Bolivia [3].

Group 1: Company Overview - Ecopetrol S.A. is a Colombian majority state-owned energy company that plans to continue exploring natural gas in the Caribbean deepwater despite Shell's exit from Colombia [1] - Shell confirmed its withdrawal from three offshore blocks in Colombia, including COL-5, Purple Angel, and Fuerte Sur, which were jointly operated with Ecopetrol [1] Group 2: Gas Demand and Exploration - Ecopetrol will proceed with exploratory drilling in offshore blocks due to significant reserves and high potential returns, driven by rising domestic gas demand [2][3] - Colombia's gas reserves are dwindling, leading to increased dependence on energy imports, prompting Ecopetrol to focus on developing new gas resources [3] Group 3: Regulatory Environment - The Colombian government, under President Gustavo Petro, has halted the issuance of new oil and gas exploration contracts, impacting upstream production strategies [4] Group 4: International Interest - International players, including Petrobras, are showing interest in Colombia's gas projects, with potential acquisitions in the blocks previously held by Shell [5] - Ecopetrol and Petrobras had previously collaborated on gas exploration, achieving a breakthrough with the Sirius-2 well in the Gujaira Basin, which could enhance natural gas production if economically viable [5]

Group 1: Company Insights - Ecopetrol S.A. (EC), Expand Energy Corporation (EXE), and RPC, Inc. (RES) currently hold a Zacks Rank 2 (Buy) indicating positive market sentiment towards these companies [1] - Diversified Energy Company operates as an independent oil and natural gas producer in the U.S., focusing on the production, transportation, and marketing of natural gas and natural gas liquids, benefiting from rising demand for cleaner-burning fuels and increasing commodity prices [2] - Expand Energy, formed from the merger of Chesapeake Energy Corporation and Southwestern Energy Company, is positioned to benefit from the growing demand for natural gas in the energy transition, with recent price increases expected to enhance profitability [3] - RPC generates stable revenues through a variety of oilfield services, including pressure pumping and rental tools, and is committed to returning value to shareholders via consistent dividends and share buybacks, making it appealing for investors seeking steady returns [4] Group 2: Industry Trends - The demand for natural gas is rising as it is recognized as a cleaner-burning fuel, which is expected to positively impact the financial performance of companies involved in its production and marketing [2][3] - The energy transition is increasingly highlighting the role of natural gas, suggesting a favorable market environment for companies like Expand Energy that are focused on this sector [3]