Environment & Energy
Related: About this forumHalf of US Shale Producers “Could Go Bankrupt”
http://www.nationofchange.org/news/2016/01/19/half-of-us-shale-producers-could-go-bankrupt/Prices have fallen below $28 a barrel on the back of the historic news over the weekend of sanctions being lifted on Iran. This is the lowest level for oil since 2003.
The markets are spooked that the lifting of sanctions means the imminent introduction of half a million or so more barrels of oil per day from Iran into an already oversupplied market. The country has the worlds fourth-largest reserves of oil.
Speaking earlier today at the Asia Financial Forum in Hong Kong, Stuart Gulliver, CEO of HSBC said: Major producers are currently delivering 2-2.5 million barrels per day more than demand, so the question is how long they can continue to overproduce for at that level.
Already struggling with oversupply from various countries, the market now has Iran to contend with too. After years of isolation due to sanctions, Iran reportedly has a significant amount of oil to place on the international market immediately. Analysts from Barclays said simply: Iranian exports come at a very bad time.
EdwardBernays
(3,343 posts)that means that banks will have to default on 100s of millions in loans to oil companies... oh wait... the opposite of lucky.
krispos42
(49,445 posts)Doubtless the Saudis and OPEC are doing this to weaken Russia and drive petroleum alternatives like shale and tar sands oil into bankruptcy. They're catching a solar and wind a little bit, too, but those technologies compete more with natural gas, coal, and nuclear.
A year of this, once Russia is distracted dealing with economic problems and the petroleum-alternatives industry out of business, the price will creep back up again.
PeoViejo
(2,178 posts)Halliburton makes a killing again.
KelleyKramer
(8,912 posts)For a good step in the direction of keeping whats left of clean drinking water in the US
hatrack
(59,578 posts). . . . at least in Oklahoma.
Nihil
(13,508 posts)Bankruptcies would also increase as the amount of damage increases
(or becomes public at least) due to the "let's evade litigation" strategy
mastered by coal companies.
.