While Texas bankruptcy attorneys expect that oil and gas bankruptcy filings will keep coming at a steady pace in 2021, Fitch Ratings cut its expected default rate this year for high-yield energy debt nearly in half as refinancing activity has pushed loan and bond maturities further into the future.

"Our updated 2021 energy default rate forecast stands at 6% compared with our previous expectation of 11%," Fitch said Jan. 20. "An improved oil price environment and distressed debt exchanges conducted last year (notably Nabors Industries Ltd. and SM Energy Co.) reduced the likelihood of further defaults by these issuers this year."

Nonetheless, energy issues dominated Fitch's latest list of "bonds of concern," making up roughly $8 billion of the nearly $26 billion worth of debt that Fitch said is at an increased risk for default. Because of earlier defaults, the proportion of energy issues causing concern has dropped from 54% in October to 31% in January, Fitch said.

Since 2001, high-yield energy issues have defaulted at just over 5% per year, Fitch said, a rate that exploded to 14% in 2020 but that did not top the nearly 19% rate seen for energy firms in 2016.

Overall, Fitch cut its expected default rate of all high-yield lending to 3.5% from 5%-6% in 2021. The 2020 U.S. high-yield default rate was 5.2%, Fitch said.

"Additional government stimulus and rollout of the coronavirus vaccine should further bolster market sentiment and help maintain healthy access to the capital markets," Fitch said of high-yield issuers.