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Oil crashes below $50 – Big Oil loses $200 billion

Screen Shot 2015-01-07 at 22.48.35

Screen Shot 2014-02-18 at 18.34.00The meltdown in oil prices has wiped out more than $200 billion in market valuation among the 10 largest oil and natural gas companies in the S&P 500. To combat depressed prices, oil companies are hitting the brakes on spending and laying off workers. Investors are saying “enough.” They are dumping their energy stocks as the outlook for profits and dividends has diminished significantly.

From a BBC News article published 7 Jan 2015 under the headline:

Screen Shot 2015-01-07 at 23.11.04“Brent crude oil price dips below $50 a barrel”

The price of Brent crude oil has fallen below $50 a barrel for the first time since May 2009.

It fell more than a dollar to $49.92 a barrel in early trading on Wednesday before edging back above the $50 mark.

Slowing global growth and increased supply of oil and gas have pushed prices sharply lower in recent weeks.

The price of oil traded in the United States, known as West Texas Intermediate crude, has already fallen below $50.

Many observers expect the price of oil to fall further as North American shale producers continue to supply increasing quantities of oil and gas, and the oil-producing group Opec resists calls for cuts in production to support prices.

“With no sign that Opec will do anything about over-production, it seems likely that we could well see further declines towards $40 in the coming weeks,” said CMC Markets analyst Michael Hewson.

FULL BBC NEWS ARTICLE

From an article by Matt Egan published on 7 Jan 2015 by CNNMoney under the headline:

“Big Oil loses $200 billion from oil price crash”

ExxonMobil (XOM), the largest public energy company in the world, has seen its market cap plunge by more than $50 billion. Energy titans like Chevron (CVX) and ConocoPhillips (COP) have experienced even sharper declines on a percentage basis.

These companies are being slammed by crude oil falling below $50 a barrel. Drilling projects that made lots of financial sense at $100 a barrel no longer look smart.

America’s 10 largest oil and natural gas companies have lost more than $200 billion combined since oil peaked in June, according to a CNNMoney analysis of FactSet data.

To combat depressed prices, oil companies are hitting the brakes on spending and laying off workers. Investors are saying “enough.” They are dumping their energy stocks as the outlook for profits and dividends has diminished significantly.

FULL CNNMoney.com article 

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