Oil Collapse: “This Could Cause The Most Destructive Economic Situation Since the Great Depression”

by | Jan 28, 2015 | Headline News | 175 comments

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    With the price of oil hovering around $44 and U.S. oil inventories at record highs the general consensus is that the economy will soon see a boost in consumer spending as Americans will take their gas savings and spend it at retail stores.

    But there’s a lot more going on with oil on a geo-political scale than can be pumped into a 30-second propaganda soundbite from financial pundits and talking heads. While lower prices may seem like a boon for the American economy, what’s been missing from mainstream assessments are the fundamental data points that show just how serious a problem we may be facing.

    As you’ll see in the succinct breakdown by Future Money Trends in the micro-documentary below, we’ve got some big problems coming our way. It all starts with the fact that debt in the energy sector over the last six years has exploded to $1.7 Trillion on the hopes that oil would continue to trade at around $80 to $100. As we know, that’s no longer the case, which means that all of the companies who took out large loans are no longer able to service their debt.

    The end result will be widespread defaults in the oil industry. It’s a recipe for disaster and one that will likely play out right before our eyes in coming months.

    In the context of current central bank money printing, deflation scares and currency wars; this could cause the most destructive economic situation since the Great Depression. We could see the oil price spike and crash in wild swings of volatility; further scaring already timid capital markets and destroying any thoughts of economic recovery. This will be felt the worst in the United States.

    Oil Wars: A sobering assessment of what may be coming in the very near future


    (Watch at Youtube)

    Multi-billion dollar companies like Sanchez Energy and Goodrich Petroleum crashed 80 and 90% since June 2014. Not only will our energy sector be drastically cut down, the rest of the economy may suffer even more. We’ve created financial structures that only function properly under conditions of constant economic growth. The financial system almost went out of control in 2008.

    For the first time in 18 years, oil exporters are pulling liquidity out of world markets rather than putting money in. The world is now fast approaching a world reserve currency shift. If we see 8 to 12 months at these oil prices; U.S. shale industry will be wiped out. The effect on junk bonds will cascade to the rest of the stock market and U.S. economy.

    …and this time there will be nothing left to catch the falling knife before it hits the American economy right in the heart. Not the FED nor the U.S. government can stop what’s coming. Liquidity will freeze up, our credit will be downgraded, the stock market will start to collapse, and then we can expect the FED to come in and hyper-inflate the dollar. This will cause the world to finish abandoning the world reserve currency in the last rungs of trade. This will be the end of the petrodollar.

    While lower gas prices have been great for Americans historically, we are now facing a completely different animal because so much debt is tied to an industry that believed it was unstoppable.

    We have literally hundreds of thousands of layoffs being predicted across the sector and many analysts are forecasting recessionary environments in states like Texas that are most dependent on the oil boom. Layoffs will have an almost immediate impact on local economies, as well as an already fragile real estate market.

    Couple that with the panic that will undoubtedly come when big oil companies start closing up shop and can no longer pay those hundreds of billions of dollars in debts, and you can see how this could well be the trigger for a serious meltdown in global financial markets and debt instruments.

    Follow Future Money Trends for news updates, interviews with leading contrarian thinkers, market analysis and regularly produced micro-documentaries like the one you viewed above.

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      175 Comments

      1. Survivor in waiting

        Love the picture of the ship. I’m keeping that one in my favorites. It also is an appropriate picture for the economy.

          • Atlas

            When FMT (or anyone) abbreviates the Federal Reserve as FED as if it is an acronym it makes me question how informed they are about the topic.

            Of course, if FED meant F&$@ing Economic Dictators, then I might laugh.

            • robertsgt40

              “…our credit will be downgraded…” At least we know it won’t be the S&P doing the downgrading. They might sit this one out. LOL

              • yourmotherwaswrong

                Mac Slavo says:

                “While lower prices may seem like a boon for the American economy, what’s been missing from mainstream assessments are the fundamental data points that show just how serious a problem we may be facing.”

                Translation: Mac thinks deflation is a bad thing!

                “While lower gas prices have been great for Americans historically, we are now facing a completely different animal because so much debt is tied to an industry that believed it was unstoppable.”

                Translation: Mac thinks deflation is a bad thing!

                Questions for Mac.

                Q: Who is “We?”

                Q: Who’s debts are you talking about?

                “Couple that with the panic that will undoubtedly come when big oil companies start closing up shop and can no longer pay those hundreds of billions of dollars in debts, and you can see how this could well be the trigger for a serious meltdown in global financial markets and debt instruments.”

                Lord, we can only hope for such an event.

                Reset.

                • yourmotherwaswrong

                  Let’s see how fast we can turn top to bottom.

                • Future Money Trends

                  No one can cram the whole picture in their minds.

                  $1 Trillion + in college loan debt, stronger dollar with deflation = higher real cost of repaying that.

                  If lower prices temporarily balances out debt no one knows.

                  Maybe its a break even. But the crash in junk bonds/shale sector can ricochet into the whole stock market like the housing bubble did. THIS is the danger.

                  • Swandog

                    Higher inertest rates in the future?

                    • Future Money Trends

                      That’s a toss up; pertinent question though. We think they at least won’t be raised this year as they had stated and planned. The announcement to postpone should be short-term mildly bullish for stocks and bearish for dollar index.

                      They likely may never raise rates until a new currency paradigm takes over.

                    • Swandog

                      If all current loans start defaulting, will that not make it more expensive to borrow ? Meaning higher rates across the board?

                    • Future Money Trends

                      Isn’t it just up to the Federal Reserve to set rates?

                      Some lower level loan rates maybe would start rising

                • E. Grogan

                  You obviously know nothing about the German depression of the 1920’s. People literally had to carry their money around in wheelbarrows because it took hundreds or thousands of German marks to buy a loaf of bread. It was horrible depression and went on until Hitler started WW2. Deflation is ALWAYS a horrible thing, it means that the currency of that country is worthless. You could be a millionnaire and not be able to afford to eat. Learn something, education is a wonderful thing.

                  • BJ

                    Education is most certainly a wonderful thing, but even more importantly is where you get your education. There are lots of “forms” of education out there, but only one that is the closest to the truth.

                    Keep looking.

            • Future Money Trends

              Yes that’s what FED stands for.

              So many people call it the ‘FED’ even Ron Paul, see “End the Fed” book and more public speeches.

              Anything ‘federal’ with federal in the name can be shortened to FED this is to save us from having to say federal reserve every time. Thanks for your concern. I writer usually likes to be very clear with what is being said. I think the writer reverse adapted to what FMT’s standard is to say ‘FED’

              • durango kidd

                I agree Daniel. Its like calling a Doberman Pinscher “Dobie”. Standard fare. 🙂

              • Atlas

                Yes, but they say the Fed not the FED.

            • Anonymous

              Our whole way of life–modern industrial civilization– is about to come to a close. Everything in modern society it dependent on an abundance supply of cheap oil– from plastics, glasses, and computers to tires and cars to pharmaceuticals, to transportation to whatever– you name it.

              NO oil means no modern society. And the worst problem will be the food supply: corporate farms need an abundance of cheap oil to keep running. No corporate farms means a reduction of most of the people. Indigenous societies, however, should have no problems.

              • Anonymous

                When it costs more to extract the oil than it does to sell it, that’s when oil industries will shut down: this is what Michael Ruppert and other peak oil experts predicted and its coming true… did you hear what they said on the video? Oil companies are losing money.

                The thing is, almost everything in modern society is made from petroleum — even the glasses you may be wearing and the plastic on your computer. And the petroleum that was used to make the outside of your car, and the tires and to run your cars… we are screwed.

                • sixpack

                  When they say they are “losing money”, do they mean in comparison to the HUGE profits they’ve all enjoyed for the last several years? Does that simply mean they are not making the killing they are accustomed to?

                  • Future Money Trends

                    Watch the video. A company worth $30 billion at one time, Continental Resources, had $1 billion NEGATIVE cash flow 2014 third quarter BEFORE the oil price crash!

              • Fox in Bush

                What, pray tell, in your opinion is an indigenous society? Do you mean native americans? Do you mean south american indians? Do you mean first peoples of any continent? Do please enlighten me….

          • WhoWuddaThunkIt

            Mac, as I said before this Massive Drop in OIL is the Black Swan event. Many oil companies are still pumping oil any way even with the drop in price now below $45. There is so much oil out there they have no place to put it. Then the GOP wants to build the XL Pipeline. Crazy idiots.

            On the positive side it is a good time to take a road trip. We may even see $1 to $1.25 Gal of Gas again. I see oil hitting Mid $30 range where it will hit bottom, my guess-timation.

            • WhoWuddaThunkIt

              I will add, watch the housing market heat up again bigtime, and Banks will go after that next biggest asset class and lots of suckers out their who will again take out more loan than they can afford, as the Banks then come in again foreclose, and steal the property back up for themselves again, and rent it out to their debt slaves. We seen this game before. That is why I am going to buy up as much property as I can right now. Before the easy money hits. Cause real Estate prices will climb as easy money becomes available. When it hits peak I will sell.

              • WhoWuddaThunkIt

                BTW/ I am buying land as a Cash Buyer as I can in 2015, and no loans. Right now 50% of all property sales is Cash buyers only.

                • will

                  Whowuddathunk,

                  i’m a young guy lookin to buy land. if i can afford any. can i ask for your advice on where to buy, and what to buy?

                  you can email me

              • JohnW.

                That ship has already sailed. You buy now and you are the chump. Besides you have no money anyway. Chump.

            • Mountain Trekker

              WWTI one day does not a pipeline make. If the XL pipeline was a good idea last year, you can bet it will be a good idea by the time they can get it built. We may not be energy independent today, but lets keep preparing for tomorrow. These domestic energy producers will be back in operation again in a few short years. I may be wrong, but it seems like I use to always hear that it took cheap energy to produce a robust economy. We can only hope that is true. Trekker Out.

            • Anonymous

              watch videos on Internet of Mike Ruppert (collapse documentaries).
              Everything he predicted in these videos is coming true.

              • Future Money Trends

                Collapse, the documentary from 2009.

                Did he predict the whole shale boom? We still don’t know the FINAL way it will play out

          • Mountain Trekker

            Everyone was screaming when gas was $4.00 a gal. and the economy was in the dumps and now that gas is under $2.00 a gal. the same people are crying about what its going to do to the economy. Don’t know about you, but I’m going to enjoy it while it lasts and hope it goes lower. Trekker Out.

            • islander

              good time to load up on diesel and propane

          • watching and waiting

            Thank you for all you do. No body should be deceived. A great fall is coming, we are seeing the death of the American empire or America’s role as the world leader.

            In this transition, there will be great confusion, anger and much blood shed.

            I am not saying i want to see this. It is just what it is.

        • FreeSlave

          No worries mate!

          Obama appointed an Ebola Czar, and voila!, no more ebola in Amerikka.

          If things get bad with oil, Obama will appoint an Oil Czar, and voila!, no more economic crash.

          Have faith in your Lib masters, young padawan.

          • Ever Vigilant

            They call it Malaria now….Not Ebola. I told my wife they are isolating a possible case of Ebola at Mass General in Boston and I told her it will be called Malaria and sure enough…..That’s what they called it. It hasn’t gone away folks they are told not to report on it or call it Malaria.

            • sixpack

              I suspect ebola has come to my area in NW Oregon.

              When I called to make an appt with my Dr, they now ask if you’ve been to Africa or any of those exposed countries in the last 21 days, or if you’ve been exposed to anyone who has. They weren’t asking that in December 2014.

          • Tonto

            Did you mean, no more oil?

            • Kulafarmer

              If you like your oil,
              You can keep it,,,,

              • JohnW.

                I guarantee that Obama put the Saudis up to this flooding the oil market. This will be the new real estate collapse only worse.

          • durango kidd

            “Not the FED nor the U.S. government can stop what’s coming.”

            Not true.

            The oil problem can be EASILY solved. EASILY. Got that? EASILY!!!

            POTUS can peg the price of oil produced and used within the continental United States at $70 per barrel. Such a move would not be unprecedented considering that the US Government has previously, historically, pegged the price of gold.

            $70 per barrel oil within the USA would be a price that would benefit both producers and consumers while stabilizing the financial markets.

            DK for President!!! 🙂

            • BJ

              statist!

              • durango kidd

                USA!!! USA!!! USA!!! 🙂

                • yourmotherwaswrong

                  the durango kidd says:

                  “POTUS can peg the price of oil produced and used within the continental United States at $70 per barrel…”

                  The kid is talking about “price controls” here.

                  Historically, only Communists and Fascists imposed price controls.

                  Attaboy DK!

                  Show the “peeps” your true collectivist/socialist colors!!

                  • durango kidd

                    YMWW: Wrong again asswipe!!! Why let a few hundred Saudi Princes set the price of oil & gas and hold sway over the American economy, destroying American jobs, when America can control its own economic destiny?

                    Oil & gas are a strategic asset essential to a well oiled economy, and a strong economy combined with a strong military is essential to American independence.

                    Nothing socialist about pegging the price of American oil & gas at $70 per barrel so that both producers and consumers benefit.

                    All markets are manipulated and controlled. Name one that isn’t. A “market economy” is an illusion in America today. And garage sale economics is not returning anytime soon.

                    Get a brain Tin Man. 🙂

                    • Future Money Trends

                      Is the precedent that the price of oil was controlled (set) in the 1970’s? ( Oil crisis)

                      Please let us know the information

                    • durango kidd

                      Daniel the precedent was the pegging of gold at $35 an ounce by FDR where it stayed until 1971. The Saudi’s have controlled the price of oil & gas since 1973 for THEIR benefit.

                      Why let others control our economy when we have the power now to control it for ourselves? The same could be said for the FED. Why let others control our money when the mechanisms of the Central Bank could and should be managed by Treasury?

                      If I were Putin I would cut Saudi production in a heartbeat and would believe that the survival of my nation and the prosperity of my citizens justified my actions.

                      America need not resort to armed conflict to save our economy and jobs. We can simply peg the price of all oil produced and utilized within the borders of the USA at $70 a barrel.

                      Problem solved. 🙂

                    • Future Money Trends

                      force people to pay $70 for crude oil? Refined, unrefined? How do you regulate, manage decide that

                  • Future Money Trends

                    It’s not out of the scope of the U.S. Government to try. They’re already pretty far fascist. Price controls will NO DOUBT be implemented under the new healthcare (obamacare) system if it’s not drastically changed

                    • durango kidd

                      Price controls under Obola Care are already underway with a new payment scheme for doctors and health institutions. The intent is clearly to move the system to a single payer system. 🙁

            • FreeSlave

              “DK for President!!! :-)”

              Far better than the POS country-killing Lib cancer that’s in the office now.

              • Maverick

                FS, if DK can turn this country around I’ll register to vote for the first time ever and vote for him. But ONLY as a independent, NOT for either one of the gangster parties.

              • durango kidd

                Absolutely FS!!! An astute observation!!!

                And if you want your guns you can keep your guns. Ammo and 30 round magazines too. APG’s for everyone. If you want your gold you can keep that too. Body armor will be standard issue to all registered voters.

                Any ILLEGALS in the past 30 years must return home and take their kids too. The FEDERAL RESERVE functions will be assumed by Treasury, and all CB hung. Any Members of Congress who voted for any Patriot Act, Agenda 21, or any other Unconstitutional Rule, Regulation, or Law will be tried for TREASON, and the CIA Top Brass will be publicly beheaded on the Washington Mall for their crimes against the American People.

                As Dictator in Chief I will cancel DWTS, Idol, and The Kardashians!!! Is that a winning Platform or what??? 🙂

                • durango kidd

                  RPG’s – Fat finger syndrome. 🙁

                • vincent

                  DK, if you can also enact legislation that mandates RANDOM drug tests for the House, Senate and all staff, you can get elected. Not sure if Boehner can pee in a cup in his terminal state of inebriation, but WTH!

                • sixpack

                  It should be enough to get you promptly assassinated…

                  • durango kidd

                    sixpack; Yes those kardashians are a violent bunch, and the fans of DWTS are obviously radicals of the first rank.

                    Fortunately I have Sheriff Joe to protect me. 🙂

            • durango kidd

              Oil Wars I & II is more FEAR MONGERING. I am surprised that you were not encouraged to buy more junior silver miner stocks at its conclusion.

              LMFAO!!!! 🙂

              • Future Money Trends

                Who else do you blame for fear mongering? 90% of the alternative media community?

                • durango kidd

                  Daniel I believe in “Prepping”. Prepping is a sign of intelligence. I do not believe in Yellow Journalism, especially when it is designed to incite fear and generate profit from that fear, as you do.

                  You past suggestions to buy Junior Mining Stocks are especially egregious at this point in the cycle; and they would be an especially poor investment if your prognosis of doom were accurate.

                  You do this community a diservice.

                  While your facts are accurate and an impressive collection of data, you use them to build a case for “financial collapse” when that argument is DESTROYED by my simple suggestion, that all of the chaos that you suggest COULD happen, could be EASILY averted by pegging the price of a barrel of oil at $70 if it is either produced or used within the USA.

                  If you don’t believe that the PTB are as least as smart as I am, then you are not nearly as smart as I have previously given you credit.

                  Faced with my easily imposed, and historically precedented solution, your argument is totally irrational. 🙁

                    • durango kidd

                      Rick Rule has a VESTED interest in getting shills like you to manipulate the opinion of Alt Media Sheeple on his behalf into investing into a product (junior mining stocks) that is essentially ill liquid without more fools buying into the scam; to support his balance sheets and increase the value of his stock options.

                      The community here believes that a stock market crash is imminent. Commodities are crashing. Retail demand is non-existent. And you yourself repeatedly warn of impending “collapse”. Why would anyone of sound mind buy ill liquid paper when they can buy the metal itself?

                      Junior mining share purchases should be very selective with strong targets that are actually producing companies,
                      and then, and only then, prior to the start of a new business cycle.

                      Rick Rule is full of shit and you can tell him I said so.

                      These stocks are no where near a bottom and that is why Rick Rule pays you (read “sponsors”) to spread his propaganda. You are a fucking shill. 🙂

                    • Future Money Trends

                      Well all it takes is a critical mass to change the paradigm. When You’re the one who can help set the next bull trend, why not?

                    • Future Money Trends

                      Remember, whenever we mention an order of importance, we say everyone should own some physical metal FIRST.
                      Yes stocks are for people looking to speculate and want to risk their money for some major profit.

            • Nuke Em Duke

              Great solution Brain Box.
              Hey….why not peg the price of everything……all problems solved.
              PEGHEAD.

              • durango kidd

                Fuck off asswipe!!! 🙂

          • TheGuy

            More like no more oil if the track record holds.

            Well look, something was going to happen one way or the other. Do you want to get punched in the face or the stomach? How long do you think the economy would last with gas at $5.20 a gallon?

        • PO'd Patriot

          Yup the only thing missing was the rats en masse using the scuppers for an exit.

        • ChitlinsWhisky&Skirt

          Can someone tell my why silver is down by a whole dollar? Is the the alleged return of king dollar?

          • Future Money Trends

            Because markets move

            Well GATA would say its the cartel’s hammering it down.

      2. AC

        Wait, do you mean the current Great Depression that started in 2008, or the previous Great Depression that started in 1929?

      3. eppe

        Makes one wonder who and what to believe any more…

          • JustMe

            It is already rippling out into what is left of American heavy industry as well…

        • Yohan

          I believe I’ll have another drink…..

          • Captain Crunch

            Well I just cracked an ice cold IPA ,

            Cheers!!

            • socmarine87

              If you like IPAs, you got to try some of Dog Fish Head IPA 120. Samuel Smith makes a great IPA as well.

              • Captain Crunch

                Socmarine I will try some , you have a deal sir

                Thanks for the recommendation

                • socmarine87

                  Enjoy Sir.

              • Doctor Chris

                I like an IPA from Trader Joe’s, too, sold undr the KBW label.

              • will

                we just brewed a few kegs. time to start up a few more, it looks like…….better stock up on sugar and hops….

        • WhoWuddaThunkIt

          Again eppe does not know a thing and his 21 green sheep followers agree. This site cracks me up. Was that a joke eppe? lol

          • eppe

            wwti, was NOT a joke. Been reading doom porn since ’98, Gary North was one of the originators. How much has rang true? 5-10%. Why do you attack me for telling the truth?
            Is it not one of you pet peeves? How about ‘death to liars?’
            Are you ever going to answer POG?
            I wish you get worse neighbors than the screaming lady.
            Have a blessed day…

            • Chickenhead

              Gary North is a religious nut who bought wholesale into the Y2K scam because he fervently believed Jebus was coming back and that his one-way Rapture ticket was about to be punched. Anyone that believed Gary (who has long since expunged all of his armageddon/y2k rantings from his website) deserved to be duped.

      4. swinging richard

        A crash was coming regardless. High oil prices hurt the consumer, low oil prices hurt the producers.

        • Old Guy

          Richard your correct. The consumer only has a certain amount of dollars. the dollars they dont spend on oil will be spent somewhere else. The net amount of dollars that consumers inject into the economy stays the same. So now I think we no longer need to import crude oil. Isnt that what we wanted to be independent of foreign oil? The US consumer has been getting the shaft from the big oil companys ever since the fake gas shortage in the 1970,s.

      5. Ron Ahrens

        Please oh please oh please we can only hope this happens soon while we still have a remote chance at bringing down the Corporatist Stasi fascist GENOCIDAL filth infesting our land

      6. Anonymous

        I am a pumper (lease operator) out in N.E. Utah. It has hit us so hard out here. Newfield Exploration just cut 250 local jobs today. The company I work for just fired my direct supervisor today. It is going to get so fùçkin gnarly so so so soon. I’m grateful I got my house and my cars paid off and am prepped for at least 3 yrs off grid.

        Stay armed , shoot first question later , keep your heads on the proverbial swivel ,
        Strengthen your families , work harder tomorrow than you did today.

        Sweet Jesus this is going to be a wild ride….

        • admin

          Take care of yourself Anon — It’s gonna get rough for folks in this industry!

          Great to hear you are prepped just in case — “Economic Collapse” is affecting millions of Americans right now. Those who plan ahead like you did will, at the very least, have the basics covered.

          Good luck !

          • Captain Crunch

            Thanks Mac , that was me that posted as anon for some reason.

            Pardon my cursing folks, it just gets rough when we could all use some friends for a change

            • Mountain Trekker

              The West has always been a Boom-Bust area, the only energy field in the West that has been long term stable situation, is the Coal Fields and Obama is doing his best to bring them down. Trekker Out.

              • Mountain Trekker

                A funny thing just happened on my way to make a comment. I made one and it was posted and 15 mins. later I made one and it went into moderation. the system no longer knows me. I feel like a guy without a website. Trekker Out.

            • will

              Capn, I just wish I HAD a house to be paid off right now. I’ve always appreciated noreast Utah……maybe I’ll be the guy setting up a tent next door. We have a serious dearth of neighborly folks where I live, but my work hasn’t been mobile enough to permit me to move. yet.

              How do you like your place?
              If its still a good idea to buy land, should i try and buy a piece up there?

        • Ancient Echoes

          Hey relax. Those of us who went through all this when the housing market collapsed are still alive, just barely but still kicking. We need to learn how as a sociaty to avoid these bubbles.

          • Kulafarmer

            First thing would be to actually hold the fuckers who created the bubble accountable for it,,,
            That would reduce the gambleing with peoples livlihoods,

            • Stolz Vorfahren

              Kula, I know you think Zionist referral gets old but the reality my friend is the truth. These are the faces of ” fuckers who committed economic crimes against not only the Americans but the humanity”.

              http://www.streetinsider.com/images/news2/88/8894338/fedheight.jpg

              As long as we ignore the truth and unable to name the actual criminals correctly the suffering shall continue but this time it may lead to a total destruction.

              • will

                Stolz, we’ve all read Jekyll Island. we know who did what.

          • FreedomFighter

            We need term limits to throw the permanent class of maggot politicians out.

        • TEST

          Think of preppers, e.g., in Greece – whether or not there is a nuke war, Santorini blows up again, an asteroid hits, etc. etc. in Greece – do you really think those preps Mr. Papadoupoulos made are not benefiting him now?

          Point is, preparedness is good for a wide, wide range of possible outcomes.

        • Maverick

          Anon, best wishes to you and yours. Things are going to become way too interesting this year.

      7. Captain Crunch

        It’s going to get real gnarly real soon

        Hope everyone is prepped and ready to go!

        GAME ON

      8. Captain Crunch

        The company I work for as a lease operator (pumper) just fired out foreman.

        This is crazy. Crazy crazy

        Good luck everyone

        We all need some luck

      9. Valley Boy

        Excellent article and video Mac. Thanks once more for putting things out there in layman’s terms for this old codger to understand! You make it easy to connect the dots and make sense of it all! Keep preppin everyone!

      10. XTP

        I’ve mentioned in another article that I worked, key word being worked for a company that makes fracking material, things have been slow for about 2 months, we’ll on the 22nd, they closed the doors, the cost of cheap oil

        • admin

          Best wishes to you XTP — can’t be easy getting hit like that out of nowhere. And really it seems like it came out of nowhere, prices were at $80 – $100 and then BOOM – all of a sudden at $44 in a few months. Pretty crazy how quickly things can flip like that.

        • Captain Crunch

          XTP I hear you

          I just had my last two wells fracked two weeks ago and they just fracked the last one like 3 days ago. Work over rig is on location now rodding up , got to bring it into facilities tomorrow afternoon. Thank god for frack crews and work over rigs

          • apache54

            i know some folks in Texas and they are being told not to worry and so they are not and are continuing to spend money on toys and are deep in debt, they are gonna have a real rude wake up call very soon and then we will see all these toys for sale on Craig’s list, just shows how many people are still just sheeple, very sad!

            • Maverick

              Apache54, I’m debt-free so I don’t have THAT type of stress in my life. can get more supplies at one time than I could have otherwise. No bill collectors for me to worry about.

              • apache54

                Mav,
                glad to hear you are OK, this may have a long ripple effect through the whole country and will be awhile before we see how far it will go. we dropped out many years ago and so it won’t really hurt us, but is always not nice!when this happens

        • Kulafarmer

          Bummer, have a friend who just got laid off because the company he works for is cutting back in ND, was an equipment operator, he said they are keeping all their mexican labor because they work for peanuts, was not real pleased,

          • cranerigger

            Well put. Sounds like the experience of many southern CA construction workers I knew. The politicians did nothing to protect American citizens, while an open-door policy applied to illegal aliens.

      11. TEST

        Isn’t the lead picture at top a pix of the USS Obama?

        Just asking.

        • admin

          Dang! I should have photoshopped the name! Haha

          • BJ

            Mac,
            Wait til people start to see how much the fine is for not having insurance in 2014. I just ran my W2 numbers in a calculator online to figure it out. I am going to be fined $587…….I can’t really describe what I am thinking and feeling. And the town my house is in will charge me about $800 city tax this year….that is not prop taxes, that is city taxes based on my taxable gross income last year. So that is almost $1400 for those two alone. I have a good job but a large family with 7 mouths to feed. Wait til some get this fine and don’t have a good paying job.

            BTW, that city tax sucks at home base…..I haven’t been there in 2 years.

          • Maverick

            Mac, photoshopping it would’ve been nice, except make it the USS African Virus.

      12. Buck

        Just try to explain to the average idiot American that low oil prices aren’t a great thing!!

      13. Ass hat

        They are saying they are laying off oil engineers was on fag news this morn who knows take the cheap gas while you can top off all your tanks now before the spike in prices.

      14. SmokinOkie

        Captain Crunch- you’ll be in my prayers. Hang in there!
        Everyone- this IS NOT the end of the world. My usual respect for Future Money Trends notwithstanding, the video above didn’t impress me. Too much fast-talking, sky-is-falling doom and gloom. Yeah, I know, everybody is gonna start tossing the ‘normalcy bias’ insults at me, claiming I got my head in the sand (or elsewhere).
        Folks, we’ve been through a collapse or two before. You ain’t gonna die. The world will still turn. Go back and read Captain Crunch’s comment again (number 3321491, listed under anonymous name). He said “I’m grateful I got my house and my cars paid off and am prepped for at least 3 years off grid.”
        That’s the whole point! Captain is prepared for changing times! Preparing is what we do. It’s who we are. When one has done all they can to be ready for future events, they need NOT be afraid, nor depressed.
        Cap’n, I know it sucks to see your industry sinking. I worked briefly in the oil industry back in the 1970s/80s. No expert by any stretch, but I’ve seen absolutely wild boom and bust times. In the early 1980’s the US rig count was around 4500. Before the decade ended it had dropped below 800. I used to live in the Oklahoma town where Halliburton was founded. I remember the layoffs, the empty houses, the closed dark businesses. Economic bust is a discouraging thing to see. It was a painful few years, but Oklahoma (and the rest of America) survived.
        Who knows what the US will look like in a few years? Things are bad and getting worse in many parts of our country. But we WILL survive. that is- if we get prepped, stay prepped, and keep our heads on straight.

        • Captain Crunch

          Hey thanks Smokin!! I appreciate it more than you know
          I have other options as my father and mother raised me right and taught me to look for opportunity when it is available. I have an invention I’ve been working on that will get a more accurate crude oil sampling during the purchase process. I will be working on it more now that my hours have been cut. Take care

        • eppe

          Amen, Smokin…
          We will survive this, will be tough for many…
          Hope grandson is well, same to your family, because in the end, it is family that counts.
          Sure miss the Smokin stories…

          • SmokinOkie

            Thanks eppe. He’s doing pretty well. Got to see him a couple days ago when at home. Sure miss that little guy.
            Best to you and all here at the site. We remind me of one big happy dysfunctional family 🙂

            • Ghost Rider

              Glad to hear things are going well Smokin, keep in touch when you can

              GR

        • Anonymous

          Really missed you smokin okie. Hope you and yours are doing great. Keep the faith brother

        • Maverick

          SmokinOkie, glad to see you back. Yes, we will make it BECAUSE WE PREPARE FOR THINGS LIKE THIS. My prepping is continuing ad everyone else needs to continue prepping also. I’m damned sure still prepping, staying prepped, and keeping my head on straight. It’s very heartbreaking, disgusting, and discouraging to see what our country has become, but if we trust in God, He will see us through.

      15. rednek101

        Been through two of these busts. The first one i wasn’t ready for.

        Most don’t realize the effects on oil industry workers when oil prices crash. 1 drilling rigs stack out leaving 24 roughnecks out of work for months at a time. These guys were knocking off $80-$100 grand a year. Indirect jobs supporting drilling…truckers, cementing, fracking and completions, roustabouts building tank batteries, on and on. Lots of high paying jobs are lost. Now all these people aren’t putting money into the economy. This is only on the exploration side of the equation.

        For oil alone the State of NM is loosing something like $200MM in revenue from oil royalties annually. It’s a big hit for a small state.

        • Old Guy

          So a few big buck earning folks lose jobs. So a parasitic state government loses some revenue. Thats a pittance compared to what all the ordinary joe,s cobined are saving on fuel cost. They will now spend the money that formerly went into the pockets of a relatively few in the oil industry in other place,s. cheep gas is good for more folks than it harms. Ten years ago the average price of a gallon of gas was $1.37. You all have been clamoring for a reset. Now your getting a reset in the oil sector and all you can do is predict doom & gloom. Its the same revenue just spent of different things. you cant make something from nothing by giving it to one sector of the economy.

          • Frank Thoughts

            Totally agree! This is a good move and a populist move: it puts wealth back into the pockets of regular folk. Screw the Wall Street commodities speculators and the dudes in the oil fields (hell, I saw the Dallas Buyers Club and know what they get up to). I am a family man and do not mind giving fewer dollars to those dirt bags.

            Whatever moves occur that pull cash out of these bubbles and puts into the pocket of ordinary people, is a good thing. As for it destabilizing scummy countries around the world, I could not care less if some a-hole in Saudi can’t afford to upgrade his Rolls Royce to the next model.

            • scott jones

              Spot on Frank I travel down to Santa Monica every three weeks for cancer treatments And im so sick and tried of seeing these little boys in there 20s driving brand new Farraris and Lamborghinis all Saudis punk little shits I say nuke the hole middle east

            • iron worker

              YOU are a ass and probably collect govt welfare and thus are jealous of hard working men that work long hours and can afford nice homes and cars what movie are you going to use now as your guide to this response

          • rednek101

            First of all…really your glad people are losing their jobs so you can pay $50 less a month for gas. I’ve worked in the oil patch. These people work 60-80 hours a week for their $80K and they work like dogs. They don’t do these jobs for the glamour. They do the jobs because they need them.
            The price of bread in 2004 was $1.05. So what. I was making 1/3 less wages back then.

      16. Hunter

        Kudos on the pep-talk Smokin’-Oh!
        In the long run, I hope/pray you’re right!

        ————————

        That said, back in the ’80s we didn’t have the NAFTA leech, draining the lifeblood of our manufacturing base..nor rampant parasitical ‘illegal immigration’..nor economically debilitating WTO & GATT treaty interference..nor a multi-quadrillion $$$ derivatives market/scam..nor a +trillion $$$ govt debt load…and lastly, back then the FSA(free-shit-army) numbers were somewhat manageable, at least!

        ..today, the deck is heavily stacked against a real recovery, so much so..as most realize a collapse, is now a certainty!

        ————————-

        Personally sir…if I were you..I’d keep a very close eye on the recent announcement by Obummer-corp..that mexican trucking companies will be allowed full access to haul freight, coast-to-coast here!

        ..just sayin’, pal.

        ..I think all of us are in for a “rough-ride”…soon!

        ..I also think said ride..is by DESIGN!

        ————————-

        I wish you & yours all the best, Smokin’…ditto, everyone here at Mac’s site..per the comming ‘troubles on the way’..

        I also hope everyone monitors…the ongoing acceleration of events..per the social/economic/total control GLOBAL AGENDA, of the synagogue of satan.

        • SmokinOkie

          Thanks Hunter. You’re right that national economic schemes have made things different today than in the past. So, the future after a crash is not really predictable. On a personal level, I think most here at shtfplan will come out the other side scarred and bruised… but stronger. It’s in our mindset. Hope everyone is still prepping best they can.

        • Pissed Off Granny

          Thanks Hunter for another dose of factual reality.

          • Hunter

            **-SMOOCH-**

            I love you, Granny!!!!

      17. Tricia

        The current administration seems to despise both oil and the United States.

        Factor that in to any predictions you make about oil, the dollar as reserve currency, etc.

      18. citizen

        lost job in mining dec 29. Been prepping for years switched to back up plan and still prepping. Before 2008 gas was cheap. Went to 4.00 a gal economy crashed. Now gas is under 2.00 and the last of the high paying jobs are being swept away. Stick a fork in what was left of the middle class. You want fries with that?

      19. Sgt. Dale

        Well when in the hell will motor oil start going down. I want to pick up some to stock pile some, and oil filters for my F150. I would like to get some oil for my gennies also.

        Going to fill my 100 Gal. gas tank if the gas gets down to $1.50 in my area. So far it still sets at $1.95. Looking at 5 Gal. plastic gas cans today and they are asking $12.99 for the damn things. I was getting them for 5 or 6 dollars just a year ago. WTH!

        On another note wouldn’t it be nice to see the price of AMMO fall like this, and reloading stuff also fall this hard. I would be a HAPPY CAMPER!

        Just watched Mad Max. Maybe the writer of this story knew what the future was really going to look like? and what caused it. “OIL”!

        This crash in oil prices will tear down the economy of not only the USA, but several other Nations namely Russia, and nations in the middle east. Oh well we knew something would have to, or was going to do it. Isn’t that why we PREP?

        A.S.M.S.
        Sgt.

        • Maverick

          Good evening, Sarge. That’s only one of many reasons why we prep. Keep prepping, stay prepped, keep your head on straight, trust in God, and you will make it. AIM SMALL MISS SMALL Maverick aka Braveheart

      20. Hillbilly

        We have a lot of oil reserves in the U.S., yea it might cost more to bring up …But we have it. So look at Russia right now, are they suggesting that were headed there? What about Saudi Arabia? Don’t the have their own concerns with ISIS? Do you think that they are not dependent on the U.S.A. to protect their ass’s about the same time the oil industry needs a price increase? I wouldn’t say it’s a fix-all, but it might not be the doom&gloom presented here.

        • Sgt. Dale

          Hill:
          ISIS and Russia depend on oil money to run things, Russia the government and ISIS the terror war. If they don’t get at least around $90.00 a barrel the are screwed.
          Sgt.

      21. Foxglove666

        Bubbles are bubbles are bubbles…… As long as interests rates are kept super low you are going to see investors going into riskier areas and creating more bubbles. Everyone wants max ROI for their investment dollar. When interest rates are This low you will also see greater participation in the derivatives game. People gotta hedge their bets in the big casino. It is not a rigged game, it is an out-of-control game. Guys on Wall Street and gubmint types are being given WAY too much credit. They really are not that smart, just extraordinarily greedy.

        • Conspiracy Nut

          Foxglove

          You got that one right man, Wall street suit types aren’t as smart as their press releases claim they are. It reminds me of the big corporate ceo’s who earn hundreds of millions of dollars annually to supposedly make critical decisions about the future of the company. Like trying to paint some ridiculous picture of some guy in a suit just sweating bullets and knocking himself out daily to earn his money, when the reality is most of the time is spent enjoying fine dining and luxury jet aircraft flights to exclusive golf courses. I love it when the company they’re running files for bankruptcy and they turn around and say” Hey, it would have been WORSE if I WASN’T here!” Or like Ken Lay, the old ceo of Enron was painted to be an absolutely CRUCIAL guy in the running of the company, but when the shit came falling down the portrait was quickly switched to ” Hey, Ken doesn’t now about the day to day operations of everything at Enron, so it’s not HIS fault. The whole thing would make for great tv comedy if it wasn’t true,

      22. HOPE

        Hello Iowa, ’tis a new day matey, hope you’re in a better frame of mind… One day at a time Iowa, you’ll be A-ok. Thoughts & prayers xXx

      23. KorHi

        FYI,
        NDC, (national drilling company) is hiring. Drillers and Rig managers. If you want on you better get your asses in gear. They will be hiring 50 or so in Feb. Work out of Abu Dhabi.

      24. LOOKn

        Howdy folks, a newbee here, not new to blogs or preppin, but to this site, smile. I read all the comments and just gots to reply to smoken. You would be right on my friend, right on “if” it were times of old, you have forgotten to take in the fact of what generation this is, IE the “generation of the fig tree” the “last generation” I don’t know for sure (I will come May) but it appears to me that this is the event that will start it all, or should I say end it all, smile, I also got to reply to the oldguy, man oh man are you dead wrong, yes people are paying less for fuel now, but that dosen’t mean that have it to spend, they are putting it towards the dept they created while paying those hi prices, and it will be a few years before any of them are caught up. but not any where soon enough to catch all the banks that will be failing here shortley. When oil prices are hi, it is a spending frenzy, which is a good thing for the econemny, when they are low, the savings to the consumer is not quite that fast at spending and no where near as much as the workers on the rigs, yup, if these prices stay down another month, we are DONE.
        LOOKn

      25. Ass hat

        I was an oil man 3years ago I just delivered it though it was expensive and people that were poor would run there tank out at home and I would go and give them 100 gals and a prime sometimes the burner wouldn’t fire and they would need service. I’m sure the amount of poor folks this year is more. But the oil business is like that I’d get payed off during the summer or spring or I would deliver gas and diesel. I’d go down to the pier and fuel fishing boats. I didn’t really make that much $ because the people I worked for. I’m sure the oil company’s are losing $ but they can afford it beleive me. It sucks once again for the worker he gets laid off. Sgt the ammo prices falling would be great. I think the days of $20 bricks are over forever. We are seeing the slow decline this is easier to adjust to than a total implosion .we can take steps to insulate ourselves as we go. The economy is changing the hands on jobs are going away. Nobody wants to be a machinist or a truck driver any more the kids leaving school don’t want to do anything at all but play with their devices. My work is slow they are not hiring barely get 50 hours a week was getting 60 it will pickup soon it always does. Country is definetly in decline. I just keep rotating my supply’s and work as much as I can. I do my little projects after work. That’s all you can do just stick to your own agenda.

      26. ... --- ... S O S ... --- ...

        Like rats abandoning a sinking ship the filthy rich will forsake any modicum of responsibility for the demise of civil cohesion that they “THE ELITE” are guilty of engineering… “OFF WIV THEIR ‘EDS”

      27. Joe in JT

        Because two oil fracking companies are going to default on their loans we should all be upset and worried? I think not. What does an oil fracking company really do? They inject millions of gallons of poison chemicals into the ground ruining aquifers that took 10 million years to fill with clean pure water that could service two or three cities for years. Now it’s all poisoned as the water catches fire when it comes out of the tap. And the oil company says ” I dunno what happened”? Not to mention fracking causes earthquakes. Just look at a current earthquake map of Oklahoma to see proof of this fact.

      28. ZombieDawg

        Planned ahead…well prepared..don’t need the gov’t for anything..
        Say yer prayers oh ignorant, phone hugging detached from reality zombie masses..
        THIS year it will all fall apart, as will your pathetic shallow empty lives.
        REAP WHAT YOU SOW.

      29. ghost

        Ok the price goes up,we our doomed.It goes down we our doomed.This all sounds like Y2K all over agine.Now this old trucker is going back to work.

      30. Frank Thoughts

        This piece must have been written by the oil industry. Lower oil prices are not an economic disaster, nor is the bankruptcy of hundreds of pump-and-dump oil speculation companies. The alternative energy industry is waiting in the wings to pick up where Big Oil will leave off. This is the transition we have needed to make for decades. It is time to see the disgusting petro states of the Middle East get hit hard and for the developed world to take seriously energy conservation and alternative energy industries.

        Importantly, the precedent has been set for the government and the Fed to pick up the slack where it may be in the economy, so nothing to worry about there either. The dollar will not hyperinflate because hyperinflation is a consequence of government and legal breakdown, not of too much money or too much credit. Any surplus cash will just chase investments overseas while the dollar will be backed up with the good faith and honor of the United States military and the securo-industrial sector. China can’t match that, baby.

      31. Davos

        Ridiculous. The oil industry created this entire crisis. It was OBVIOUS for to anyone paying attention that there was a huge pump and dump FRAUD being ran by the shale producers and frackers. They were fleecing investors by putting holes in the ground, bringing up nothing, and running off to the next site to rinse and repeat.

        Now we should want oil prices to stay high so they can continue to commit rampant fraud and also profiteer off speculator inflated oil prices. They should all go bankrupt. And then go to prison.

      32. Jersey Tom

        I work in logistics, specifially chemicals and raw materials traveling via rail. My supervisor quit in September to go work for the largest supplier of fracking sand in the world. Their mines are shutting down. Staff is being let go.

      33. Hillbilly

        I was a butcher most my life, back in 95, 96&part of 97 I worked on triples drilling.We made decent money, but nobody was getting rich.It’s hard work throwing chain and making tongs bite. Alaska was cold and Northern/Southern California was hot. Oil company’s play the markets and tomorrow it may be a whole different ball game. My guess is since they’ve been laying off, major change won’t occur until spring, cost less to make hole then.

      34. Woogie

        The last quarter GDP (when prices on gas were tumbling),showed any savings from the gas prices went mostly to increasing healthcare costs. In this month, any savings from the gas went to pay their credit card bills from Christmas shopping.

        More people are being laid off now from the gas price, Oil companies are laying off and shutting down, Cat is down, UPS is down, even McDonalds is losing money plus many other businesses. There are more businesses going out now than are starting up. So why is the latest Pew poll saying most people are confident in our economy? Something stinks with Pew!

      35. CraigV

        Quick question…if Russia needs oil above $90 a barrel to survive, what did they do before the spike in prices a few years ago?

        That’s been bothering me. It’s not like they just got into the oil business in the last few years.

        I understand the shock to the recent fracking boom, but I’m confused how suddenly Russia MUST have it above 90 a barrel or their country is doomed.

        Thanks to anyone who can explain this.

        • Tricia

          Russia doesn’t need it above 90 a barrel to survive.

          They need it above 90 a barrel if it is to be the sole basis of their economy and they stay a part of the current world/financial system using the US Dollar as a reserve currency for all settlement in international payments. They can (and probably will) change both of those conditions.

      36. THE EVER SEEING EYE

        SOS SOS SOS

        … — … … — … …—…

        Thats Morris code for you uneducated under common core

        • samuel p

          Make that Morse, dimwit.

          • THE EVER SEEING EYE

            middle finger

        • Bwoy Scout

          -.. ..- — -… .- … …

          • THE EVER SEEING EYE

            ?

            • Bwoy Scout

              TESE… Thought you knew “MORRIS” code!

      37. THE EVER SEEING EYE

        ONE DAY WE WILL GO TO WAR OVER RICE.

        A quot form the movie DOGS OF WAR.

      38. Mick McNulty

        There are some major differences all to the downside which sets this coming Depression apart from 1929. There was no massive QE in ’29 and Roosevelt was able to ask financiers like Morgan for loans, whereas today the financiers failed first. America has no industrial and manufacturing base upon which to rebuild and those people who still have the skills and could still teach them will soon have retired or passed away. And it’s unlikely America can create an agricultural base because agribusiness and monoculture and GMOs and poisoning the land and waterways makes it unlikely.

        When America falls nect time it ain’t getting back up, and unless economic failure foils your leaders they have chosen your next incarnation, a murderous third world dictatorship.

      39. Bigbluedrew

        I agree that falling prices don’t significantly help the working man. He is drawing from (an ever shrinking) finite pool of money to pay his fuel cost, freeing up some of that expense WILL allow him to allocate those funds differently but as to helping ” improve the economy no, only higher wages and more jobs created would do that. Will he use the new windfall to pay down debt, my guess is that most will not, they will use it to buy extra stuff. The people making the stuff will see additional profit while the energy sector will see decline, this is NOT growth. Growth is the only thing that can save our economy and falling oil prices ain’t it. My biggest fear is that the banking industry which has a staggering interest in the energy sector might go under with a protracted depressed oil market. Does ANYBODY know how much in derivatives is pegged to the oil industry or the effects on the world economy at large that would be produced if these derivatives were to collapse. IMO when the music stops the whole thing will come to a head VERY quickly, even faster than the 08 collapse. As to wether the Titanic can be shored up to float a bit longer as was done in 08 who knows. My night vision scope comes in next week, time to move on to the next critical prep and Fast.

        • Future Money Trends

          Some WILL pay off debt, yes, and that is further deflationary (as debt = money)

          Yes the problem in today is the corrupt banking cartel CREATING new money from thin air and giving to the rich and the banks, stealing from everyone through the ‘inflation tax’ That’s what needs to stop to grow the economy. Without the middle class the economy is a bunch of Have’s and Have Not’s

      40. Chir

        Video is spot on. Wish it wasn’t. Have a few friends out of work from the collapse of the energy companies that “were” drilling and pumping in the former oil boom Bakken fields.
        Companies out there are dropping like flies and bankruptcy lawyers are the only ones making money. Lot of people are now out of work with obsolete skills that were cutting edge before the oil crash. Saudi ruling class is the only one laughing all the way to the bank, where they convert their dollars to gold as future hedge when the dollar pops.

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