Another troubled motor oil company files Chapter 11 bankruptcy
The Houston-based oil refining company files for Chapter 11 bankruptcy seeking to recapitalize its balance sheet or sell its business.
By Kirk O’Neil/The Street Sep 25, 2024 5:59 PM EDT
Oil producers faced financial challenges from reduced demand and lower oil prices during the Covid-19 pandemic. That downturn lasted about two years until higher oil prices in 2022 benefited oil companies, but also helped drive inflation.
Currently, West Texas Intermediate crude was at about $69.79 a barrel and Brent Crude was at about $73.55 on Sept. 25. A U.S. Energy Information Administration forecast on Sept. 10 predicts Brent to rise to $82 in the fourth quarter and average $84 in 2025.
But rising prices are not the reason several oil-related companies filed for bankruptcy in 2024. Prices might have been an issue if they had been falling, however. Other situations, some unique, have caused companies to file for Chapter 11 bankruptcy.
Oil and gas services company Nitro Fluids, which provides fracking services to oil and gas companies, on May 15 filed for Chapter 11 bankruptcy reorganization in the U.S. Bankruptcy Court for the Southern District of Texas in Victoria, facing a huge revenue decline that it blamed on industry consolidation.
Distressed petroleum products company Stanley Oil & Lubricants faced legal issues that forced it on Sept. 17 to file for Chapter 11 protection in the U.S. Bankruptcy Court for the Eastern District of New York.
The company sought the bankruptcy court's automatic stay on legal actions after a U.S. District Court judge granted one of the debtor's suppliers a preliminary injunction against it in a trademark and copyright infringement lawsuit, freezing certain assets and halting certain business activities.
Finally, conventional oil refining and recycling company Vertex Energy (VTNR) and 23 affiliates on Sept. 24 filed for Chapter 11 protection in the U.S. Bankruptcy Court for the Southern District of Texas in Houston seeking approval of a plan to either recapitalize the company's balance sheet or sell its assets through a restructuring support agreement.
The company listed $500 million to $1 billion in assets and liabilities in its petition.
Vertex will seek approval of $80 million in new money debtor-in-possession financing term loans for working capital, general corporate needs, and to finance its Chapter 11 case. It will also seek to roll up $200 million in pre petition loans.
The Houston-based oil refiner, which was founded in 2001, produces and distributes petroleum products, re-refines used motor oil into various petroleum products, and refines renewable diesel and other fuel products at its Mobile, Ala., refinery.
By Kirk O’Neil/The Street Sep 25, 2024 5:59 PM EDT
Oil producers faced financial challenges from reduced demand and lower oil prices during the Covid-19 pandemic. That downturn lasted about two years until higher oil prices in 2022 benefited oil companies, but also helped drive inflation.
Currently, West Texas Intermediate crude was at about $69.79 a barrel and Brent Crude was at about $73.55 on Sept. 25. A U.S. Energy Information Administration forecast on Sept. 10 predicts Brent to rise to $82 in the fourth quarter and average $84 in 2025.
But rising prices are not the reason several oil-related companies filed for bankruptcy in 2024. Prices might have been an issue if they had been falling, however. Other situations, some unique, have caused companies to file for Chapter 11 bankruptcy.
Oil and gas services company Nitro Fluids, which provides fracking services to oil and gas companies, on May 15 filed for Chapter 11 bankruptcy reorganization in the U.S. Bankruptcy Court for the Southern District of Texas in Victoria, facing a huge revenue decline that it blamed on industry consolidation.
Distressed petroleum products company Stanley Oil & Lubricants faced legal issues that forced it on Sept. 17 to file for Chapter 11 protection in the U.S. Bankruptcy Court for the Eastern District of New York.
The company sought the bankruptcy court's automatic stay on legal actions after a U.S. District Court judge granted one of the debtor's suppliers a preliminary injunction against it in a trademark and copyright infringement lawsuit, freezing certain assets and halting certain business activities.
Finally, conventional oil refining and recycling company Vertex Energy (VTNR) and 23 affiliates on Sept. 24 filed for Chapter 11 protection in the U.S. Bankruptcy Court for the Southern District of Texas in Houston seeking approval of a plan to either recapitalize the company's balance sheet or sell its assets through a restructuring support agreement.
The company listed $500 million to $1 billion in assets and liabilities in its petition.
Vertex will seek approval of $80 million in new money debtor-in-possession financing term loans for working capital, general corporate needs, and to finance its Chapter 11 case. It will also seek to roll up $200 million in pre petition loans.
The Houston-based oil refiner, which was founded in 2001, produces and distributes petroleum products, re-refines used motor oil into various petroleum products, and refines renewable diesel and other fuel products at its Mobile, Ala., refinery.
