Diamond Offshore Drilling

Diamond Offshore's April 2020 bankruptcy collapsed a major offshore drilling contractor when oil prices made deepwater drilling uneconomic. The company operated 15 drilling rigs serving oil majors in deepwater basins. When COVID crashed oil prices, customers suspended or canceled contracts, leaving Diamond without revenue to service debt. The company emerged from bankruptcy in 2021 with a smaller fleet and reduced debt. Diamond demonstrated that offshore drilling's high fixed costs and commodity exposure create existential volatility.