Bond Vigilantes Push Slam $258 Billion of Oil Debt – -Yields Soaring

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.
As U. S. oil executives from Anadarko Petroleum Corp. to Hess Corp. take drastic measures to weather the worst slump in a generation and cling to their debt ratings, creditors are already writing some of them off. So much so that late last month, average borrowing costs for energy bonds with the lowest investment grades – issues totaling $258 billion – soared past those of the highest-rated U. S. junk borrowers for the first time. What’s more, debt issuance industry wide has all but ground to a halt after a record year in 2015.

This post was published at David Stockmans Contra Corner on February 26, 2016.