Healthy storage levels, weak weather-related demand and low prices are all discouraging production in the US and Canada.
The continuing global oil price slump is denting the finances of oil and gas producers and increasing market pessimism. Ratings agency Moody’s added to the pain in March by saying that US oil and gas companies are finding it harder than ever to find the cash to run their business. The agency downgraded its ratings for 19 energy companies last month, 17 of which were exploration and production firms. It expects the rate of defaults to rise during 2016.