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US energy bankruptcy wave surges despite recovering oil prices

The wave of U.S. oil and gas bankruptcies surged past 60 this week, an ominous sign that the recovery of crude prices to near $50 a barrel is too little, too late for small companies that are running out of money.

On Friday, Exco Resources, a Dallas-based company with a star-studded board, said it will evaluate alternatives, including a restructuring in or out of court. Its shares fell 58 percent.

Exco's notice capped off one of the heaviest weeks of bankruptcy filings since crude prices nosedived from more than $100 a barrel in mid-2014.

Prices have bounced back to $46 a barrel from February lows in the mid-$20s, but the futures market shows investors do not expect U.S. benchmark crude to rise above $50 for more than a year.

That will not help smaller producers built for far higher prices. These companies have largely exhausted funding alternatives after issuing more equity and debt, tapping second-lien loans and shedding assets over the last two years to stay afloat as banks trimmed credit...