The volume of debts of the American corporation “Whiting Petroleum» almost four times exceeded the finances available on its accounts.
This was reported by The Wall Street Journal.
Whiting Petroleum Corporation was founded in 1980 in Colorado and was engaged in the production of shale oil. Lately the corporation, as well as several of its subsidiaries, has announced the beginning of voluntary bankruptcy in accordance with Chapter 11 of the Bankruptcy Code of the United States.
When this became known, Whiting Petroleum shares fell 45%.
In the communique of the corporation, the decision was explained by the fact that it was not able to cope with the collapse in oil prices. In addition, they pointed to “uncertainty” in the energy sector due to the lack of an agreement between Russia and Saudi Arabia.
It is noted that Whiting Petroleum Corporation should continue to operate in its normal mode, as the company has over $ 585 million in its bank accounts. At the same time, the company’s debt exceeded $ 2.2 billion, which means its finances are leveled.
As News Front previously reported, the spread of coronavirus infection COVID-19 led to a reduction in oil demand, which, together with an overestimated supply, provoked a collapse in prices. An attempt to limit the extraction of raw materials within OPEC also failed. So, in the world, the fourth oil war began in the last 35 years. For the United States, the situation is aggravated by the fact that a significant part of US oil production is the shale segment, which becomes unprofitable in the face of a collapse in prices.