Energy bankruptcy filings back on the rise

After a recovery from the last oil bust, energy bankruptcies are back on the rise in 2019.

The number of oil and gas bankruptcy filings through midAugust nearly equaled the tally for all of 2018, according to the energy bankruptcy monitor maintained by the Houston law firm Haynes and Boone. The aggregate debt from 2019 bankruptcy filings of almost $20 billion has already surpassed the roughly $17 billion accumulated in all 2018.

The biggest filings this year include the oilfield services giant Weatherford International and a slew of oil and gas producers such as Houston companies Sanchez Energy, Halcón Resources, and Vanguard Natural Resources, and Legacy Reserves of Midland. Halcón’s and Vanguard’s filings were the second bankruptcies for each since the last oil bust.

The energy sector is dealing with subdued oil and gas prices, slowing drilling activity and a wave of layoffs from companies such as Halliburton, National Oilwell Varco and Pioneer Natural Resources as the oil and gas industry loses favor with investors, which is squeezing most companies’ access to capital.

Oil and gas production in both Texas and the nation as a whole is at record highs and still rising. Oil prices have been stuck in the $50 to $60 range. Crude lost 73 cents a barrel in New York trading Thursday to settle at $54.47 a barrel.

The last oil bust saw crude prices plunge from more than $100 a barrel in 2014 to a low of $26 in early 2016. Bankruptcy filings began to skyrocket in 2015, peaking in 2016 and then slowing down afterwards. Now they’re back on the rise again.

The energy industry has counted about 400 bankruptcies since 2015. More than half were Texasbased companies.

Forty energy companies have filed for bankruptcy so far this year, with industry analysts anticipating more in the weeks and months to come.