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The Worst May Be Over For U.S. Oil By Irina Slav - Dec 22, 2020, 12:00 PM CST
More than 40 oil and gas companies in the United States filed for bankruptcy protection in the first eleven months of this year, according to Haynes & Boone’s latest report. Their cumulative debt load is $24.732 billion. And yet, things in the U.S. oil patch may not be as bad as the number of bankruptcies might suggest.
Bloomberg Intelligence recently reported the value of oil and gas bonds trading at a distressed level in mid-March totaled $144 billion. By the end of November, this was down to $37 billion. And analysts expect a lot fewer bankruptcies next year.
Chart of the Week
Demand for transportation fuels (gasoline, distillates, and jet fuel) was down 11% during the Thanksgiving holiday compared to the holiday week a year earlier.
Jet fuel, however, was down by nearly half, or a decline of about 0.9 mb/d.
There were about 107,000 flights during the week of Thanksgiving, down about 45% from 2019 levels.
Market Movers
ConocoPhillips (NYSE: COP) announced a significant oil discovery in the Norwegian Sea.
Diamondback Energy (NASDAQ: FANG) announced a double deal to buy two rivals for a combined $3.2 billion. It will purchase
QEP Resources (NYSE: QEP) and also
Guidon Operating LLC. Enverus analyst said it is “a realization among small producers how difficult it is to deliver on returns expectations.”