Big banks are cringing as crude oil is crumbling

Seems the drop in oil prices are causing some panic in the big bank board rooms.

Big banks like Wells Fargo, JPMorgan and a few others are sitting on huge loans from the oil sector.

Billions of dollars at stake if loans and lines of credit go bust.

Guess they didn't do enough stress tests !!!

Worldwide problem too I suspect.

What's next if oil goes to $10 ???

Big banks are cringing as crude oil is crumbling

Firms on Wall Street helped bankroll America's energy boom, financing very expensive drilling projects that ended up flooding the world with oil.

Now that the oil glut has caused prices to crash below $30 a barrel, turmoil is rippling through the energy industry and souring many of those loans. Dozens of oil companies have gone bankrupt and the ones that haven't are feeling enough financial stress to slash spending and cut tens of thousands of jobs.


For instance, Wells Fargo (WFC) is sitting on more than $17 billion in loans to the oil and gas sector. The bank is setting aside $1.2 billion in reserves to cover losses because of the "continued deterioration within the energy sector."

JPMorgan Chase (JPM) is setting aside an extra $124 million to cover potential losses in its oil and gas loans. It warned that figure could rise to $750 million if oil prices unexpectedly stay at their current $30 level for the next 18 months.

Oh Well.

or is it "Oil Well"

a reply to: xuenchen

Seems like an opportunity to pick up some assets real cheap. Normal banking procedure.

Then there's those loans that have benefitted by the lowered cost of oil. Like the rest of the economy....

a reply to: xuenchen

bad time to take a 2nd mortgage out on the house, they'll screw me royally (they already do)

ha

Just wait until Iran start pumping their oil, they will be adding another 500,000 barrels per day to an already oversaturated market, I see this easily bringing it down to $18/$20 a barrel.

a reply to: xuenchen

That's ok. I'm sure they'll get bailed out by taxpayer money again. They're too big to fail.

Maybe Iran can buy the loans off and hold until paid.

Here comes another trillion dollar bailout. Time for some record bonuses.

It's a funny old world, we've gone from "oil is running out we're not going to have any left so we must increase the prices" to "we've got too much oil in the market, we're all going to go broke"

I hope it keeps falling and I hope the global economy dies a well deserved death so that we can start again

The price of gas two years ago was about $1.39 (per liter), it is now $0.69 (per liter) here.

Admittedly, I wasn't paying attention to gas prices when I was younger, but I have never seen it that low.

Sounds like Karma!

What sucks is that karma will just get pushed to us lowly people.

Of course they are working up to bailout why let it leak out otherwise. Do colleges make financiers dumb or do they become so blinded by greed?

originally posted by: Ghost147
The price of gas two years ago was about $1.39 (per liter), it is now $0.69 (per liter) here.

Admittedly, I wasn't paying attention to gas prices when I was younger, but I have never seen it that low.

In the uk a couple of years ago it was around £1.40 per liter, its now £0.99 per liter. I remember when I was a kid buying petrol for my track bike for 20 pence per gallon!!

originally posted by: MOMof3
Of course they are working up to bailout why let it leak out otherwise. Do colleges make financiers dumb or do they become so blinded by greed?

The highly educated are the very ones that have caused all the financial collapses.

The average grade school dropouts had nothing to do with those.

for some reason, I have this wild idea running in my head that they will use this opportunity to increase the taxes on gas, using global warming as a justification, and then soon afterwards, the prices will start going up and we will be paying more than ever...

a reply to: dawnstar

Or, carbon credit derivatives !!!!

originally posted by: UnBreakable
a reply to: xuenchen

That's ok. I'm sure they'll get bailed out by taxpayer money again. They're too big to fail.

No bailouts anymore, certainly in Europe, governments have just signed up to Bail Ins, meaning any depositors money can and will be used to keep the banks afloat ...

Oil needs to collapse.

What WHAT did I just say you ask?

Think about it - what funds Saudi Arabia and all of it's interfering little plans around the world? What mostly funds ISIS?

Yep.... oil.

Take it's value away and the terrorists will starve. Think I've gone completely mad? ISIS has cut fighters salaries in half due to financial hardship Guess they are not making that million dollars a day since Russia bombed the crap out of their tanker convoys and the stuff is nearly worthless if you have to sell it for far less than the going rate.

a reply to: markosity1973

Saudi Arabia has enough open desert to power the world.

All they need is solar panels.

Total Surface Area Required to Fuel the World With Solar

originally posted by: xuenchen
a reply to: markosity1973

Saudi Arabia has enough open desert to power the world.

All they need is solar panels.

Total Surface Area Required to Fuel the World With Solar

So could Australia - we're even more desert and deserted.

Watch for stealing 401k and pension funds soon.

Then the revolt shall begin.