Bankruptcy filings are flying in the American oil patch.
At least 67 U.S. oil and natural gas companies filed for bankruptcy in 2015, according to consulting firm Gavin/Solmonese.
That represents a 379% spike from the previous year when oil prices were substantially higher.
With oil prices crashing further in recent weeks, five more energy gas producers succumbed to bankruptcy in the first five weeks of this year, according to Houston law firm Haynes and Boone.
“It looks pretty bad. We fully anticipate it’s only going to get worse,” said Buddy Clark, a partner at Haynes and Boone and 33-year veteran in the energy finance space.
This bleak outlook highlights one of the flip sides to cheap energy prices.
Sure, it’s great for drivers filling their tanks with cheap gas. But it’s also fueling the demise of dozens of drilling and servicing companies — and killing thousands of jobs in the process.
Even Chesapeake Energy (CHK), one of the better known winners from the shale boom, was forced to deny bankruptcy rumors earlier this week as its stock tanked.