Anyone who has visited London lately will have a hard time believing that it has the lowest-cost supplies of anything. Yet it does: oil reserves in the ground can be bought on the London equity market for less than anywhere else in the developed world, assuming you are not the favourite of a producing country’s ruler.

While a large fraction of the ultra-smart money in America has been throwing cash at too-early capital injections for struggling companies out in the exploration and production (E&P) patch, the junior international energy companies that are listed in London or traded there privately have been choking on dust since the oil crash started in late 2014.

Now their engines are seizing up. I am not sure any will close tomorrow. One of them, Petroceltic, has been given a further waiver of payments by its bank group until January 29, and could be bought by its biggest shareholder, Worldview Capital, an activist hedge fund, so there is still time to work things out.

But there are desperate sellers of energy assets roaming the City. For example, on January 13, Premier Oil announced the acquisition of Eon’s North Sea assets for a net value of $120m. For that, Premier got about 64m barrels of oil equivalent of reserves and resources, which comes out to a bit less than $2 per barrel.

The acquired properties have about 15,400 barrels per day of current production, so we are not only talking about science-based guesswork or financiers’ hope. When I told people in the US onshore E&P business about the deal, they asked me to check again on the report, assuming I had put the decimal point in the wrong place.

I am not blaming Eon for making a bad deal. If I were a German utility, expected to deliver highly reliable electricity at a price below its real cost, I would be desperate too. And Eon is not alone. The cheapest in-the-ground resources on offer in the London securities market are priced lower than that, if they are in a quasi-war zone such as Kurdistan, not some safe place such as Algeria or Turkmenistan. The average implied price of well-risked resources represented by the junior London companies would probably be around $4-$5 per barrel.

As one relatively sophisticated (but still disappointed) investor in the London-listed E&P companies says of his fellow shareholders: “Nobody really understood the assets. It is a clubbish environment; they all wanted to get along, and they presumed management was right.”

This is not to say that all that high level of American technical expertise or investor engagement has worked so well in the past year. After the November 2014 oil price crash, large US private investors rushed in to finance exchange offers for thinly documented oil and gas junk bonds. Many of the investors were so clever they managed to outsmart themselves, and, despite the stricter documentation and more senior status of the new bonds, the companies are still falling into the hands of the bank examiners.

The nice-guy-this-won’t-hurt-a-bit exchange offer days for US E&P junk are mostly over.

Even so, the prices of good North American oil and gas properties have not declined as much as you might think. Investors are still willing to pay a premium to avoid political risk. It is relatively easier to explain to the limited partners that a well failed due to some unexpected problem with the Oklahoma rocks than it is to go over why they should trust in the good faith of a national oil company somewhere in north Africa.

Also, while many of the international E&P company prospects have the chance to develop large resources with relatively long production lives and lower operating costs per barrel, the investors need to have patience. It can easily take two or three years, if not longer, to get all the drilling and infrastructure in place in international frontier plays. In North Dakota or Texas, though, you can get a well drilled and completed in less than four months, close to existing gathering systems and pipelines. People do not like to wait.

Maybe they should. There can be a certain, how to say, spivvy, shady aspect to some among the London oil promoters, and patience has not been well rewarded over the past year and a half. However, the decline and now sudden stop of capital spending in the E&P world is probably going to solve investors’ problems sooner than they think.

The increased decline rates of hydrocarbons produced with better horizontal drilling, sophisticated well completion and enhanced recovery techniques should tell you that less capex will lead to less production much faster than in past oil crashes. Unless the demand side is destroyed by a catastrophic depression, that will lead to a partial recovery of the hydrocarbon price within months rather than years. If so, some of those bombed-out smaller international oil and gas shares might be worth something after all.