COVID-19 and Oil Price Crash – How Durable Are Oil and Gas Contracts?
Recent weeks have seen an unprecedented collapse in the price of oil brought about by the combination of COVID-19 demand contraction and the commencement of a price war between Saudi Arabia and Russia. The market will likely put severe pressure on the finances of a wide range of oil and gas companies and service providers. That in turn will lead to strain on contractual relationships as parties use all attempts to alleviate financial pressure. In this Client Alert, we consider the contractual provisions that may feature in a predicted increase in disputes and contract terminations.