Lenders standing by shale drillers

Many of those looking for the breaking point for struggling shale producers have argued that the round of bank lending reviews the sector faces this autumn will herald a financial reckoning

Cheap and plentiful financing has been as important as anything else for the shale business. So if lenders tighten the spigot it could choke off companies' ability to keep drilling and producing. The case, for now at least, is overstated. While low oil prices and dimming prospects for growth will lead to a cut in lending to the sector, many shale producers will weather the storm. Executives across the country will be meeting with their bankers in October and November for a normally routine semi-annual review of their companies' reserves-based lending facilities. But these are not routine times. With equity and high-yield debt markets all but closed off to shale producers, bank lending is the