Oil and Debt

11 Pages Posted: 1 Apr 2015

See all articles by Dietrich Domanski

Dietrich Domanski

Bank for International Settlements (BIS)

Jonathan Kearns

Bank for International Settlements (BIS) - Monetary and Economic Department

Marco J. Lombardi

Bank for International Settlements (BIS) - Monetary and Economic Department

Hyun Song Shin

Bank for International Settlements (BIS)

Date Written: March 2015

Abstract

The total debt of the oil and gas sector globally stands at roughly $2.5 trillion, two and a half times what it was at the end of 2006. The recent fall in the oil price represents a significant decline in the value of assets backing this debt, introducing a new element to price developments. In common with other episodes of retrenchment induced by rapid declines in asset values, greater leverage may have amplified the dynamics of the oil price decline. The high debt burden of the oil sector also complicates the assessment of the macroeconomic effects of the oil price decline because of its impact on capital expenditure and government budgets, and due to the interaction with a stronger dollar.

JEL Classification: D24, L71, Q02, Q43

Suggested Citation

Domanski, Dietrich and Kearns, Jonathan and Lombardi, Marco Jacopo and Shin, Hyun Song, Oil and Debt (March 2015). BIS Quarterly Review March 2015. Available at SSRN: https://ssrn.com/abstract=2580295

Dietrich Domanski (Contact Author)

Bank for International Settlements (BIS) ( email )

Centralbahnplatz 2
Basel, Basel-Stadt 4002
Switzerland

Jonathan Kearns

Bank for International Settlements (BIS) - Monetary and Economic Department ( email )

Centralbahnplatz 2
CH-4002 Basel
Switzerland

Marco Jacopo Lombardi

Bank for International Settlements (BIS) - Monetary and Economic Department ( email )

Centralbahnplatz 2
CH-4002 Basel
Switzerland
+41612809492 (Phone)

Hyun Song Shin

Bank for International Settlements (BIS) ( email )

Centralbahnplatz 2
Basel, Basel-Stadt 4002
Switzerland

HOME PAGE: http://www.bis.org/author/hyun_song_shin.htm

Register to save articles to
your library

Register

Paper statistics

Downloads
273
Abstract Views
1,038
rank
111,503
PlumX Metrics