UPDATE: WTI just hit a $58 handle…
The overnight stability (and brief dead-cat-bounce this morning) has turned into a renewed bout of selling pressure and for the first time since July 2009, WTI has broken below the $60 level. Canada Heavy is trading $42.10 (down almost $4 today!), its lowest since April 2009. Energy credit spreads are wider once again, now at +952bps.
Canada Heavy has crashed…
And WTI breaks below $60 (and bounces) after multiple stop run attempts…
Now we have a problem…
Who could have seen that coming?
As Deutsche Bank warned last month, a drop in the oil price to $60 a barrel “is likely to push the whole HY energy sector into distress.”
Charts: Bloomberg
