Wounded by low oil prices, Chesapeake Energy files for bankruptcy
Chesapeake Energy Corp has filed for Chapter 11 after the pressure of burdensome debts in combination with drastically reduced demand for energy overcame its finances. There has been concern for months now over the viability of America's over-leveraged shale oil producers. The high cost of shale production means that it's only a profitable venture when oil prices are relatively high, but oil has been the victim of economic lockdown during which only a fraction of the world's daily commuters actually went to work, went shopping or took trips. Chesapeake attempted to reduce its debt levels but with no end in site to the rout on oil prices, it was unable to find a way to refinance. "Despite having removed over $20 billion of leverage and financial commitments, we believe this restructuring is necessary for the long-term success and value creation of the business," wrote CEO Doug Lawler in a statement.