• 3 minutes Could Venezuela become a net oil importer?
  • 7 minutes Reuters: OPEC Ministers Agree In Principle On 1 Million Barrels Per Day Nominal Output Increase
  • 12 minutes Battle for Oil Port: East Libya Forces In Full Control At Ras Lanuf
  • 15 hours Oil prices going Up? NO!
  • 2 hours Reuters: OPEC Ministers Agree In Principle On 1 Million Barrels Per Day Nominal Output Increase
  • 6 hours Renewables to generate 50% of worldwide electricity by 2050 (BNEF report)
  • 26 mins The Tony Seba report
  • 2 hours Kenya Eyes 200+ Oil Wells
  • 2 hours Are Electric Vehicles Really Better For The Environment?
  • 1 day Oil prices going down
  • 11 hours Saudi Arabia turns to solar
  • 1 day Could oil demand collapse rapidly? Yup, sure could.
  • 23 hours China’s Plastic Waste Ban Will Leave 111 Million Tons of Trash With Nowhere To Go
  • 2 days Oil Buyers Club
  • 2 days Russia's Energy Minister says Oil Prices Balanced at $75, so Wants to Increase OPEC + Russia Oil by 1.5 mbpd
  • 2 hours OPEC soap opera daily update
  • 1 day Battle for Oil Port: East Libya Forces In Full Control At Ras Lanuf
  • 2 days Gazprom Exports to EU Hit Record
  • 1 day Tesla Closing a Dozen Solar Facilities in Nine States
Where Will U.S. Frackers Drill Next?

Where Will U.S. Frackers Drill Next?

With oil prices having stayed…

OPEC Confident Global Oil Demand Will Stay Strong

OPEC Confident Global Oil Demand Will Stay Strong

The OPEC technical panel has…

Energy Sector Defaults Hit 78 Since January

Oilfield services

Some 78 energy and natural resources firms globally have defaulted so far this year, according to S&P, accounting for 53 percent of all bankruptcies worldwide in the period. At 146, the total number is the highest since 2009.

Furthermore, said the head of S&P’s global fixed income research, Diane Vazza, as of end-September, the rate of speculative-grade defaults in these sectors jumped to almost 19 percent, the highest since May this year.

The figures call into question exactly how positive higher oil prices have been for the industry. Granted, the price rally has been shaky, but it has been welcomed by the industry as a lifeline, which it has been, in a sense. The February trough of US$27 a barrel is in the past, but the continuing volatility and the rate of defaults suggest that the new price normal is difficult for many energy firms to handle.

Reinforcing this idea, S&P said in its report that the majority of the 146 default issuers were based in the U.S., accounting for two-thirds of the total. The portion of European companies in the mix was 12, and another 11 were from Australia, Canada, and Japan. The rest of the default issuers were in emerging economies.

The S&P report chimes in with an earlier report from Debtwire, which said in September that at least 135 E&Ps in the U.S. were at a high risk of defaulting, some of them with debt loads of over a billion dollars.

The total debt of U.S. and Canadian energy companies at end-2015 was calculated by Alix Partners at $353 billion. Things haven’t improved much since then, despite the price rebound and the increase in drilling rigs, which are taken by many as a cause for optimism, despite the fact that virtually every added rig weighs further on oil futures prices.

By Irina Slav for Oilprice.com

More Top Reads From Oilprice.com:



Join the discussion | Back to homepage

Leave a comment

Leave a comment

Oilprice - The No. 1 Source for Oil & Energy News