Oil’s Slide Gives Senior Lenders Upper Hand in Bankruptcy Talks

Tumbling oil prices have helped put asset-based senior lenders in the driver’s seat when it comes to restructuring distressed energy companies.

A slew of energy bonds have lost value as crude tumbled 44 percent in the past year. Since senior lenders are most likely the first creditors that would see losses on the debt, that has given them a leading role in driving the bankruptcy process to potentially own the distressed businesses, said panelists at the 31st Annual Bankruptcy & Restructuring Conference of the Association of Insolvency and Restructuring Advisors in Philadelphia on Friday.