This post was originally published on this site
Harold Hamm, the wildcatter who helped usher in the American fracking boom and owns nearly 80% of Continental Resources Inc, lost more than $3 billion in March after Saudi Arabia and Russia triggered a global oil market crash by flooding the world with crude in a poorly timed war for market share.
Hamm made numerous calls to President Trump, urging him to take a more forceful role in persuading Saudi Arabia and Russia to end their standoff, according to the Wall Street Journal. Trump helped broker a 23-nation pact to cut output on April 12, but with oil prices still around levels many operators need to merely break even Hamm said his company would cut about 70% of its daily output compared with about 3% to 26% cuts by its large rivals.
Continental CLR, -0.93% also told some customers that it will no longer deliver crude to their refineries as called for under contract, citing a “force majeure,” or unforeseeable event, due to the coronavirus pandemic, limited storage and demand, and other factors that led to the historic price crash, according to an April 21 letter reviewed by the Journal.
On Wednesday, U.S. crude CL00, +0.50% climbed above $33 a barrel, its highest level since March 10. Continental’s shares have partially recovered, closing at $13.88 on Wednesday, about double their low point during the Saudi-Russia market war, but shares remain down nearly 60% since the start of the year.
Continental has a wall of debt coming due in the next few years, in part because the company has issued far less stock than many of its peers, preferring to raise debt instead. The company, with a current market capitalization of about $5 billion, had about $4.3 billion in debt coming due through 2024 as of the end of the first quarter, more than all but one of 15 other large independent U.S. oil producers, according to FactSet.
