Oil drillers exposed in three-way hedges

Needing protection: A customer refuelling at Repsol SA gas station in Madrid, Spain. The US shale boom is built on high oil prices and low-cost financing, which enabled drillers to spend more than they earned while making up the difference with debt.— Bloomberg

Firms use strategy that leave them vulnerable to sharp declines

NEW YORK: Oil at US$30 a barrel is blowing a hole in the insurance that US shale drillers bought to protect themselves against a crash.