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Oil Price Crisis and Bankruptcy Risk

Author

Listed:
  • Adhitya Agri Putra

    (University of Riau, Indonesia)

  • D.P. Emrinaldi Nur

    (University of Riau, Indonesia)

  • Ferdy Putra

    (University of Riau, Indonesia)

Abstract

This research aims to examine the effect of the oil price crisis on bankruptcy risk. The sample consists of 9 oil and gas companies listed on the Indonesian Stock Exchange 2013-2019. The analysis method uses fixed-effect regression. The result shows that the oil price crisis increases bankruptcy risk, especially for companies with higher leverage. Furthermore, the oil price crisis reduces market value for companies with higher bankruptcy risk. It indicates that the oil price crisis brings performance for oil and gas companies to generate revenue, earnings, and cash flow that leads companies to insolvency condition.

Suggested Citation

  • Adhitya Agri Putra & D.P. Emrinaldi Nur & Ferdy Putra, 2021. "Oil Price Crisis and Bankruptcy Risk," International Journal of Energy Economics and Policy, Econjournals, vol. 11(4), pages 7-13.
    • Handle: RePEc:eco:journ2:2021-04-2
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    References listed on IDEAS

    as
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    More about this item

    Keywords

    oil price crisis; bankruptcy risk; companies value.;
    All these keywords.

    JEL classification:

    • G32 - Financial Economics - - Corporate Finance and Governance - - - Financing Policy; Financial Risk and Risk Management; Capital and Ownership Structure; Value of Firms; Goodwill
    • G33 - Financial Economics - - Corporate Finance and Governance - - - Bankruptcy; Liquidation
    • H12 - Public Economics - - Structure and Scope of Government - - - Crisis Management

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