Third of US Oil Companies May Go Bankrupt in 2017 Amid Low Crude Prices

© Sputnik / Boris Babanov / Go to the photo bankThe prices of West Texas Intermediate (WTI), the US oil benchmark, and Brent crude, the global oil benchmark, hit record lows not seen since April 2009 on Tuesday.
The prices of West Texas Intermediate (WTI), the US oil benchmark, and Brent crude, the global oil benchmark, hit record lows not seen since April 2009 on Tuesday. - Sputnik International
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Morgan Stanley, Goldman Sachs Group and Citigroup investment banks now expect the price of oil to fall below $30 in the near future and US oil companies may go bankrupt in 2017, according to media reports.

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MOSCOW (Sputnik) — Over a third of US oil companies could face bankruptcy in 2017 amid rapidly falling crude prices, The Wall Street Journal reported.

Brent crude prices plunged more than 5 percent on Monday, reaching a 12-year low of $31.41.

Morgan Stanley, Goldman Sachs Group and Citigroup investment banks now expect the price of oil to fall below $30 in the near future, the newspaper reported.

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US oil producers will have to cut their expenditure by 51 percent compared to 2014 levels, to $89.6 billion, the newspaper quoted Cowen & Co researchers as warning.

Over 30 US oil companies, which collectively owe $13 billion, have already filed for bankruptcy protection due to the rapidly falling crude prices, the newspaper reported, citing Haynes & Boone law firm. China’s economic slowdown, the US currency’s appreciation and the fact oil companies worldwide refuse to stop drilling for more oil are listed as reasons for the plummeting prices.

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