S&P Upgrades Calumet Credit Rating to 'B-' on Strong Earnings

S&P Global Ratings has upgraded Calumet Inc.'s issuer credit rating to 'B-' from 'CCC+', attributing the move to robust earnings in the first half of 2026 and strengthening credit metrics. The ratings agency assigned a stable outlook to the specialty hydrocarbon products and fuel company.

In its announcement, S&P also raised its issue-level ratings on Calumet's debt:

• Senior secured debt was upgraded one notch to 'B+'.
• Unsecured debt was also raised one notch to 'B-'.

Drivers of the Upgrade

The ratings action was prompted by Calumet's strong financial performance, which exceeded S&P's expectations. The company's earnings and cash flow were bolstered by high margins for specialty oils, wide fuel crack spreads, and significant contributions from its renewable fuels segment, Montana Renewables LLC.

Performance was particularly strong in the second quarter of 2026, even with planned turnarounds and downtime at the renewables facility. S&P noted it expects Calumet's weighted-average adjusted debt to EBITDA to be in the 6x-7x range, with the metric likely to be stronger over the next 12 months.

Financial Management and Growth Projects

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The upgrade also reflects the company's proactive balance sheet management. In July 2026, Calumet redeemed $100 million of its 9.75% senior unsecured notes due 2028. The company's next significant debt maturity is its $325 million in senior unsecured notes due in July 2028.

Looking ahead, S&P forecasts that Calumet's free operating cash flow will remain strong into 2027, supported by earnings momentum and the sale of 45Z production tax credits. The company is also advancing its MaxSAF project to expand sustainable aviation fuel (SAF) production, targeting a capacity of 120-150 million gallons by spring 2027 and approximately 200 million gallons by the end of 2028.

Key Risk to Monitor

S&P highlighted a notable increase in Calumet's reported obligations for Renewable Identification Numbers (RINs), which surged to approximately $480 million as of June 30, 2026, from $169 million at the end of 2025. While S&P does not currently include these obligations in its adjusted debt calculations, it stated this could change if the likelihood of payment increases.

The agency's current rating is based on the key assumption that Calumet will not be required to make payments against these RINs obligations within the next 12 months.