Bankruptcies in the oil and gas sector in the US have reached levels last seen in the Great Recession.
The Dallas Federal Reserve Bank put out a report on December 23 noting that at least nine US oil and gas companies with $2 billion in debt have defaulted in the fourth quarter.
"If bankruptcies continue at this rate, more may follow in 2016," the report said.
Upstream capital spending has plummeted, according to the note, down 51% from the fourth quarter of 2014 to the third quarter of 2015.
US oil and gas employment has fallen 14.5% year-over-year from the peak in October 2014, according to the report, equivalent to 70,000 job losses.
"Job losses and falling energy prices portend continued distress for the oil and gas sector in 2016," the report said.
OPEC, the Organization of Petroleum Exporting Countries, predicts oil won't price above $100 a barrel for more than 20 years.
"Expectations have shifted toward a weaker price outlook because sanctions against Iran are likely to be lifted in early 2016, the Organization of the Petroleum Exporting Countries (OPEC) has scrapped any pretense of a production ceiling, and US production declines have slowed," the Dallas Fed said in its report.
Here are the two charts:
(Dallas Federal Reserve)
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