Oil bankruptcies have jumped over the past two months, after the coronavirus drove down energy demand and crashed oil prices.
In April and May, 14 oil and gas companies in North America filed for bankruptcy—compared with five over the first three months of the year—according to a report by the law firm Haynes Boone.
While prices have risen in recent weeks—West Texas Intermediate was trading at $39 a barrel Friday morning—those prices aren’t enough to keep many oil companies solvent, The Houston Chronicle reports.
Oil prices in the $30 range are, “not a sufficient clearing price for many heavily leveraged shale producers,” the report reads. “It is reasonable to expect that a substantial number of producers will continue to seek protection from creditors in bankruptcy even if oil prices recover over the next few months.” Read the full story.
