NEW YORK (TheStreet) -- The recent steep drop in oil prices may lead to some oil company going out of business within a few weeks, according to Amrita Sen, Senior Oil Analyst at Energy Aspects.

Low oil prices could reduce companies' borrowing lines of credit from banks, which come up for renewal on October 1, Sen explained.

"The banks will look back at the last twelve months of WTI prices, which on average has been about $45 a barrel if not lower," said Sen. "And suddenly the amount of money available to these U.S. producers to borrow is half, less than half in some cases, compared to a year ago. That makes it very, very difficult for them to continue investing, continue drilling."

If prices stay at current levels or drop further, Sen said she expects some companies will be forced to file for bankruptcy as early as October.

Linn Energy (LINE) and Energy XXI  (EXXI) have already exhausted more than 75% of the credit available to them, and they are in a "more tricky position" than some of the bigger companies, Sen said, and pointed to them as possible bankruptcy candidates.

In research published Monday, Sen wrote there are several companies likely to see their borrowing bases reduced by over 50%.

A reduction in credit will force further capital expenditure cuts among energy companies, said Sen.

What's driving Monday's crude selloff, according to Sen, are fears of weakening demand from China, along with continued oversupply.

But she added the supply/demand situation will improve, adding that Energy Aspects has identified at least 5-million barrels a day of projects that have been delayed or cancelled. By the end of next year, Sen predicts, supplies will tighten, and prices could easily more than double from where they are today.