Oil and gas bonds remain busy as crude prices bounce; Breitburn preferred units fall

By Stephanie N. Rotondo

Seattle, May 10 – The distressed bond market was again zeroing in on the energy space as domestic crude prices rebounded.

The nearly 3% rebound came as wildfires in Canada – which have resulted in production disruptions amounting to about 2.5 million barrels per day – and ongoing attacks on Nigeria’s oil infrastructure have offset concerns about increasing inventories.

Chesapeake Energy Corp.’s 8% second-lien notes due 2022 benefitted from the crude rally, closing up over a point to 65, a trader said.

“They traded a bunch,” he added.

Another trader said the debt ended up a deuce for the day.

Chaparral Energy Inc. was also higher, even after the company said late Monday that it and 10 of its subsidiaries had filed for bankruptcy.

One trader placed the 9 7/8% notes due 2020 at 35½.

“That’s about doubled,” he said, though he noted that the issue “trades only about once a month.”

Even Weatherford International plc – which got hammered late last week in the wake of poor earnings – got a bit of a boost.

A trader called the 4½% notes due 2022 up over 2 points at 74¼. A second trader placed that issue in the mid-70s and the 5 1/8% notes due 2020 around 80.

Elsewhere in the oil and gas realm, Breitburn Energy Partners LP’s 8.25% series A cumulative redeemable perpetual preferred units (Nasdaq: BBEPP) took a hit in Tuesday trading, as the market reacted to the company’s earnings release.

© 2015 Prospect News.
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