It’s not so much that the prices are going down. It’s the velocity of the drop.
This will impact the new oil fields that have mostly driven our “recovery” in the ND through TX corridor.
If Veneuzuala falls that might cause some unrest and defaults in South America that might bother us a little.
The big dog that is getting hurt is Russia. How could they retaliate? They could dump treasuries or other assets. They could retaliate against Europe. Or, the financial crisis in Russia could lead to a more physical reaction like picking a fight with someone.
The falling oil prices are great for you and me. I drive a lot. But that might be short lived if we have fewer places to drive.
I am not one of those, “it’s raining cats and dogs” guys. It’s just that everything is connected and the economic relationships are all complicated. It wouldn’t take much pulling on a string to unravel the entire sweater.
I don’t concern myself with the problems of corporations unless the government gets involved. The market will take care of that. The price of oil has been at an artificial high spiral for more than a decade. This the correction and some companies might not survive....that’s the market. What will be left is the companies who can exist at the market level. Oil futures traders are in for a bad run....that’s a good thing. Actual producers will survive...albeit with less profit...That’s the way capitalism works!!!