Oasis petroleum has filed for bankruptcy protection, the latest big us oil and gas group to hit the wall since the coronavirus pandemic sent the market into freefall.

The shale group, with production in texas and montana, blamed the severe downturn in oil and gas prices as it announced the move and joined dozens of producers to have succumbed to the price crash.

Due to historically low global energy demand and commodity prices, we determined that it is best for oasis petroleum to take decisive action to strengthen our liquidity and overcome the headwinds now challenging both our company and industry, said chief executive thomas nusz.

The sector was hit hard at the start of the pandemic, which slashed oil demand just as a price war between russia and saudi arabia left the market oversupplied. prices collapsed, with us benchmark west texas intermediate in april dropping into negative territory for the first time. producers scrambled to cut costs as they sought to keep afloat.

Oasiss restructuring had been expected after it entered a grace period this month having failed to make interest payments on bonds maturing in 2022 and 2023. however, the move suggests there is no let-up in the wave of bankruptcies sweeping the sector.

The company grew rapidly during the us shale boom over the past decade, reaching a market capitalisation of almost $6bn in 2014, ahead of the last downturn. but liabilities also rose sharply to more than $3bn in recent years, with its $2.8bn in long-term debt in the second quarter dwarfing its $420m in assets.

Oasis said the restructuring would allow it to cut its debt load by $1.8bn and receive $450m in debtor-in-possession financing.

A total of 36 oil and gas producers filed for bankruptcy in the first eight months of the year, according to houston law firm haynes and boone, a tally that is expected to continue rising into 2021.

I would expect on the producer side, were going to continue to see more bankruptcies, said charles beckham, a haynes and boone partner. the only question i have is, at some point, it would seem we will run out of inventory [exploration and production] companies that have not filed bankruptcy yet.