Quote:
Originally Posted by Red
2008 was a short term shock caused mainly by "mood". What we have right now is over supply and lack of demand. We don't know how long this will last. Maybe $70 is the new norm for WTI? Maybe $50? We don't know. The market will sort it our over the next year or so. Very different from 2008.
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2008 was a collapse of the capital markets and an overall decline in demand due to recession. Both of those smoked expansion because there was no way to borrow money for growth. The price drop killed expansion by companies that grow through cash flow because their cash flow was cut by half or more.