From The Guardian: The price of oil has dropped to around $55 per barrel, but fracking companies need prices of $60-100 to break even, reports Climate News Network… analysts say this whole investment edifice could come crashing down.
Fracking is an expensive business. Depending on site structure, companies need prices of between $60 and $100 per barrel of oil to break even. As prices drop to around $55 per barrel, investments in the sector look ever more vulnerable.
There are now fears that many fracking operations may default on an estimated $200bn of borrowings, raised mainly through bonds issued on Wall Street and in the City of London.
In turn, this could lead to a collapse in global financial markets similar to the 2008 crash.
Who would be idiot enough to invest in such a risky business? Oh, the UK government…