Due to the fact that oil prices collapsed, the value of bonds of US the oil companies also collapsed.
It is reported by the reputable business publication The Financial Times.
As noted, such a situation may ultimately lead to default. Currently, the total number of bonds of US oil and gas companies that are in circulation are about 940 billion euros. At the same time, the yield on only 12 percent of them is higher than the yield on government bonds of the United States by about 10 percent. Of course, securities of this kind are usually classified as high risk. At the same time, among bonds of companies with “Mysore” ratings – highly profitable, but not related to investment ones – among securities with increased risk, about 65% are accounted for. In monetary terms, their volume is 175 billion dollars.
“There is definitely a serious risk of default”, – commented Michael Anderson, an analyst at one of Citigroup’s largest financial conglomerates.
The expert drew attention to the fact that a large number of bonds were at risk because of the danger of defaults or restructuring.
According to the S&P Global holding, this year, US oil and gas companies have to pay off bonds worth $ 27 billion. However, investor skepticism will prevent companies from refinancing debt.
As News Front previously reported, the collapse of the OPEC + deal led to this situation in the energy market, when Russia refused to cut oil production even further.