Bond Vigilantes Push $258 Billion of Oil Debt Past Junk

  • Yields on lowest-rated IG energy bonds soar to junk levels
  • `Geopolitical game of chicken' intensifies at IHS CERAWeek

A light trail from an automobile passes beneath overhead pipework near illuminated petroleum cracking towers at the Lukoil-Nizhegorodnefteorgsintez oil refinery, operated by OAO Lukoil, in Nizhny Novgorod, Russia, on Thursday, Dec. 4, 2014. Crude slumped 18 percent last month as the Organization of Petroleum Exporting Countries maintained its output quota, letting prices decrease to a level that may slow U.S. production.

Photographer: Andrey Rudakov/Bloomberg
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They have sold off hundreds of oil fields, eliminated thousands of jobs and slashed millions of dollars from capital spending and dividends.

But in this unforgiving new world of $30-a-barrel oil, it’s barely been enough.