Distressed energy bonds improve; Transocean, Callon, Nabors, Diamond Offshore gain

By Cristal Cody

Tupelo, Miss., Feb. 8 – Distressed energy bonds climbed in secondary trading over Monday’s session as oil prices jumped more than $1.

Offshore driller Transocean Inc.’s 8% senior notes due 2027 (Ca/CCC) traded 3 5/8 points higher at 56½ bid as the week kicked off, a source said.

Transocean Ltd.’s 9.35% notes due 2041 (C/CCC-/) headed out up 2¼ points at 45½ bid.

Callon Petroleum Co.’s 6¼% senior notes due 2023 (Caa2/D) were quoted 3 1/8 points better at 83 bid during the session.

Nabors Industries Inc.’s bonds also improved after heavy trading last week, a source said.

The oil and drilling contractor’s 5¾% senior notes due 2025 (Caa2/CCC-/CCC-) climbed another 2½ points on Monday to trade at 76¼ bid after rallying 4 points on Friday.

Nabors Industries Ltd.’s 7½% senior notes due 2028 (Caa1/CCC-/B-) also gained 2 points to 84½ bid on Monday.

In other distressed secondary trading, bankrupt Diamond Offshore Drilling Inc.’s paper continued to improve on Monday, a market source reported.

The company’s 7 7/8% notes due 2025 climbed 1 3/8 points to 18 3/8 bid after gaining nearly 1 point on Friday.

Diamond Offshore’s 5.7% notes due 2039 rose ½ point to 17½ bid over the day after strong trading Friday saw the notes up almost 1 point.

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