{"id":42012,"date":"2018-12-27T08:18:35","date_gmt":"2018-12-27T13:18:35","guid":{"rendered":"https:\/\/olduvai.ca\/?p=42012"},"modified":"2018-12-27T08:18:35","modified_gmt":"2018-12-27T13:18:35","slug":"falling-oil-prices-may-spark-new-debt-crisis","status":"publish","type":"post","link":"https:\/\/olduvai.ca\/?p=42012","title":{"rendered":"Falling Oil Prices May Spark New Debt Crisis"},"content":{"rendered":"

Falling Oil Prices May Spark New Debt Crisis<\/a><\/h3>\n
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U.S. oil prices at below $50 and now even below $45 a barrel could cause concerns about the debt levels of some energy companies, Nasdaq energy analyst Tamar Essner told CNBC<\/a> on Wednesday.<\/p>\n

\u201cCredit markets have held up a lot better than the energy equity markets right now, so that tells you that credit investors out there believe in the oil story much more so than energy equity investors do right now,\u201d Essner said.<\/p>\n

Consumers in the U.S. like the low gasoline prices that come with lower oil prices, but a slide in the price of oil has a broader impact on the economy, Essner said.<\/p>\n

Some of the newer U.S. shale producers are probably deep into cash-flow negative at the current oil prices of $43 a barrel WTI Crude<\/a>, although the energy industry as a whole is \u201cin a lot stronger position\u201d today than it was in the price crash of 2014, according to the energy analyst.<\/p>\n

\u201cA lot of the debt has been put in a much more consolidated position. We\u2019ve just had a round of credit redetermination in the fall when prices were higher, so that should buy us some time in the market as well,\u201d Essner said, referring to the banks\u2019 twice-yearly borrowing base redetermination of energy companies.<\/p>\n

Over the past few weeks, when oil prices were falling due to fears that the OPEC+ production cuts won\u2019t be enough to rebalance the oil market, some companies announced their 2019 capital budget plans.<\/p>\n

Many of those companies said they would be cutting spending and the number of rigs, Essner said, noting that lower spending levels will ultimately result in a lower pace of oil production growth, but it will take time.<\/p>\n

\u2026click on the above link to read the rest of the article\u2026<\/p>\n<\/div>\n","protected":false},"excerpt":{"rendered":"

Falling Oil Prices May Spark New Debt Crisis U.S. oil prices at below $50 and now even below $45 a barrel could cause concerns about the debt levels of some energy companies, Nasdaq energy analyst Tamar Essner told CNBC on Wednesday. \u201cCredit markets have held up a lot better than the energy equity markets right […]<\/p>\n","protected":false},"author":1,"featured_media":0,"comment_status":"closed","ping_status":"open","sticky":false,"template":"","format":"standard","meta":{"_monsterinsights_skip_tracking":false,"_monsterinsights_sitenote_active":false,"_monsterinsights_sitenote_note":"","_monsterinsights_sitenote_category":0,"footnotes":""},"categories":[2,3],"tags":[195,4106,592,23083,14603],"class_list":["post-42012","post","type-post","status-publish","format-standard","hentry","category-economics","category-energy-2","tag-debt","tag-debt-crisis","tag-oil-price","tag-oil-price-com","tag-tsvetana-paraskova"],"_links":{"self":[{"href":"https:\/\/olduvai.ca\/index.php?rest_route=\/wp\/v2\/posts\/42012","targetHints":{"allow":["GET"]}}],"collection":[{"href":"https:\/\/olduvai.ca\/index.php?rest_route=\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/olduvai.ca\/index.php?rest_route=\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/olduvai.ca\/index.php?rest_route=\/wp\/v2\/users\/1"}],"replies":[{"embeddable":true,"href":"https:\/\/olduvai.ca\/index.php?rest_route=%2Fwp%2Fv2%2Fcomments&post=42012"}],"version-history":[{"count":1,"href":"https:\/\/olduvai.ca\/index.php?rest_route=\/wp\/v2\/posts\/42012\/revisions"}],"predecessor-version":[{"id":42013,"href":"https:\/\/olduvai.ca\/index.php?rest_route=\/wp\/v2\/posts\/42012\/revisions\/42013"}],"wp:attachment":[{"href":"https:\/\/olduvai.ca\/index.php?rest_route=%2Fwp%2Fv2%2Fmedia&parent=42012"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/olduvai.ca\/index.php?rest_route=%2Fwp%2Fv2%2Fcategories&post=42012"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/olduvai.ca\/index.php?rest_route=%2Fwp%2Fv2%2Ftags&post=42012"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}