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Carnage in Junk-Rated Energy Bonds Returns With Plunging Oil

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Bond investors that lent to the riskiest energy companies have seen $4 billion of market value evaporate this week as oil trades at a four-month low.

SandRidge Energy Inc.’s $1.25 billion of 8.75 percent securities maturing in 2020 issued in May have fallen to 71.5 cents on the dollar, according to Trace, the bond-price reporting system of the Financial Industry Regulatory Authority. Prices on $1.3 billion of notes sold in 2010 by Chesapeake Energy Corp., an energy producer that halted its stock dividend last month, have fallen to 82 cents on the dollar to yield 11.4 percent.