ow banks are also being affected, with Barclays and Wells said to face potential losses on an energy-related loan. Earlier this year, the two banks led an $850m “bridge loan” to help fund the merger of Sabine Oil & Gas and Forest Oil, US-based oil companies. Investors, however, balked at buying the loan when it was first offered in June and slumping oil prices combined with volatile credit markets in the months since have scuppered further attempts to sell, or syndicate, the loan, according to market participants. Barclays and Wells declined to comment. With underwriting banks unable to offload the loan to investors, they are now facing losses on the deal as the value of the two oil companies’ debt erodes. …If the banks are not able to sell the loan, they may absorb it on their balance sheets rather than try to sell it into the market. …Marty Fridson, chief investment officer at LLF Advisors, says that of the 180 distressed bonds in the Bank of America Merrill Lynch high-yield index, 52, or nearly 29 per cent, were issued by energy companies.
As a few commentators had been saying that low oil prices is not to US advantage being so close to a net exporter of energy. This to me is another form of importing deflation to the already high USD. World is awash with excess cheap money but still the structural issues remains in each of the trading block.
I am looking at 'half full' glass mind set and say that some aussie gold producers will still survive the POG/USD rout with the comfort of knowing that a big fall in oil/IO/Coal/NGAS can only be supportive of a collapsing AUD. It doesn't appear to be any price drivers of gold sentiment besides "manipulation" talk and stealth physical buying by the likes of China/Russia. Remain on the sideline and will stab at some goldies if the price is attractive enough.
