Debt
Bankruptcy Mayhem in the Oil Patch [Chart]
Bankruptcy Mayhem in the Oil Patch [Chart]
Total debt of newly bankrupted energy companies is soaring each month
The Chart of the Week is a weekly Visual Capitalist feature on Fridays.
Most investors are aware that there is significant carnage in the oil patch. Low energy prices caught overleveraged companies off guard, and it’s forced many of these companies to seek protection from their creditors through bankruptcy.
However, the pace of new bankruptcies is accelerating fast, and now bigger companies are being affected. This week’s chart shows that the 11 new bankruptcies in April 2016 carry a substantial debt load of nearly $15 billion – most of which is unsecured.
A quick look at the data, which we pulled from Haynes and Boone, LLP, tells the tale:
New Bankruptcies | Total Debt | Avg. Debt Per Company | |
---|---|---|---|
January 2016 | 3 | $32,000,000 | $10,666,667 |
February 2016 | 6 | $280,000,000 | $46,666,667 |
March 2016 | 7 | $1,840,000,000 | $262,857,143 |
April 2016 | 11 | $14,920,000,000 | $1,356,363,636 |
In the first two months of 2016, there were nine bankruptcies. Not one of the companies filing had debts that exceeded $200 million.
In March, there were a total of seven new bankruptcies, including Venoco Inc. Venoco is a private company that is heavily oil-weighted with assets located offshore and onshore in Southern California. Venoco’s filing listed that it had $1.28 billion in debts, 71% of which are unsecured.
Meanwhile, April was the biggest month for oil patch bankruptcies in the last two years. A total of 11 companies filed, but even more meaningful to investors is that four of the bankruptcies were public companies with debts exceeding $1 billion.
Pacific Energy, formerly Pacific Rubiales, used to be the largest operating oil company in South America. Now, however, the company is in the midst of undergoing dramatic restructuring. Common shares have been delisted and the company is also seeking to get extensions on its $5 billion of unsecured debt.
Texas-based Ultra Petroleum, which has nearly $4 billion in unsecured debt, has dropped from the NYSE to the OTC as it too seeks protection. The stock’s 52 week high was $17, but it now shares are trading for mere pennies.
Two other big companies to go to court were Energy XII and Midstates Petroleum. They each owe roughly $3 billion and $2 billion of total debt, respectively. Energy XII operates 10 of the largest oilfields on the Gulf of Mexico Shelf, while Oklahoma-based Midstates is focused on the application of modern drilling and completion techniques in oil and liquids-rich basins in the onshore U.S.
The grand total of debt for all April bankruptcy filers was an astounding $14.9 billion, most of which is unsecured. For reference, the 42 energy companies that filed for bankruptcy in all of 2015 had a combined $17.2 billion in debt.
Debt
The Growing Auto Loan Problem Facing Young Americans
After a borrowing spree during COVID-19, younger Americans are struggling to keep up with their auto loan payments.

The Growing Auto Loan Problem Facing Young Americans
Since the COVID-19 pandemic, Americans have taken on significantly more debt to buy vehicles. This is especially true for Gen Z and Millennials, who the Federal Reserve believes may have borrowed beyond their means.
In this infographic, we’ve visualized data from the Fed’s most recent consumer debt update.
Aggressive Borrowing
The first chart in this graphic shows the growth in outstanding car loans between Q2 2020 (start of the pandemic) to Q4 2022 (latest available).
Age | Growth in outstanding car loans |
---|---|
18-29 | 31% |
30-39 | 29% |
40-49 | 23% |
50-59 | 14% |
60-69 | 11% |
70+ | 11% |
We can see that Americans under the age of 40 have grown their vehicle-related debt the most. It’s natural for Gen Z (ages 11-26) to have higher growth figures because many of them are buying their first car, but 31% is quite high relatively speaking.
Part of this can be attributed to today’s inflationary environment, which has pushed used car prices to new highs. Supply chain issues have also resulted in over 30% of new cars being sold above MSRP.
Because of these rising prices, the Fed reports that the average auto loan is now $24,000, up 41% from 2019’s value of $17,000.
Spiking Delinquencies
Interest rates on auto loans are typically fixed, meaning many young Americans were able to take advantage of the low rates seen during the pandemic.
Despite this, one in five Gen Zs say that their car payments account for over 20% of their after-tax income.
Shown in the second chart of this infographic, the amount of auto debt transitioning into serious delinquency is much higher for Gen Z and Millennials. Throughout 2022, these generations saw $20 billion in auto debt fall 90+ days behind.
The outlook for these struggling borrowers is bleak. First there’s inflation, which has pushed up the prices of most consumer goods. This eats into their ability to make car payments.
Second is rising interest rates, which make credit card debt—another pain point for young borrowers—even more costly. Finally, there’s student loans, which are expected to resume in summer 2023. Payments on student debt have been suspended since the beginning of the COVID-19 pandemic.
-
Misc2 weeks ago
Vintage Viz: China’s Export Economy in the Early 20th Century
-
Markets3 weeks ago
Visualizing the Global Share of U.S. Stock Markets
-
Technology1 week ago
Timeline: The Shocking Collapse of Silicon Valley Bank
-
Cities3 weeks ago
Visualized: The Most (and Least) Expensive Cities to Live In
-
Datastream1 week ago
Mapped: Legal Sports Betting Totals by State
-
Energy3 weeks ago
Which Countries are Buying Russian Fossil Fuels?
-
Datastream1 week ago
The Largest U.S. Bank Failures in Modern History
-
Jobs2 weeks ago
Visualized: The State of the U.S. Labor Market