Chesapeake Energy Files for Bankruptcy
June 29, 2020
The Baker Hughes rig count was down one oil rig on Friday. The total number of rigs looking for crude oil now stands at 188, down from 793 at this time last year.
The Labor Department reported last Thursday that 1.5 million Americans filed jobless claims. This brings the total to 47 million unemployment filings since the coronavirus pandemic began.
The DOW and the S&P 500 were both down Friday as increasing cases of COVID-19 in the United States mount. Many market observers think that the direction of equities will have an influence on energy prices.
Germany’s BAFA foreign trade office reports German crude oil imports fell by 11.3% in April to 6.9 million tons. Germany’s imports from January to April were down 0.1% at 28.1 million tons.
China Observations and Other Notes
According to China’s General Administration of Customs, the country nearly doubled its crude oil imports from Saudi Arabia in May compared to last year’s numbers.
China’s customs data shows that low-sulfur marine fuel exports in May fell by 20% to 1.14 million tons. The monthly dip in demand is a reflection of less international shipping.
Satellite data showing a strong increase in traffic in China, Europe and the United States points to growing fuel demand. Data provided by location technology company TomTom showed congestion in Shanghai in recent weeks is higher than a year ago. Moscow traffic is also back to last year’s levels. This is positive data for supporting energy prices, but it is going up against concerns about growing viral cases. As COVID-19 cases grow, there is worry that we may see more shutdowns and a decrease in demand.
Chesapeake Energy filed for Chapter 11 bankruptcy and is the largest oil and gas producer to file. Chesapeake Energy was one of the pioneers of horizontal drilling.