Oil Industry Needs Half a Trillion Dollars to Endure Price Slump
- Debt issued by 168 oil companies is showing signs of distress
- Industry heading for a profound shakeout if oil stays at $40
Oil Producers Bet on Supply and Demand as Prices Plunge
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At a time when the oil price is languishing at its lowest level in six years, producers need to find half a trillion dollars to repay debt. Some might not make it.
The number of oil and gas company bonds with yields of 10 percent or more, a sign of distress, tripled in the past year, leaving 168 firms in North America, Europe and Asia holding this debt, data compiled by Bloomberg show. The ratio of net debt to earnings is the highest in two decades.