This story was originally published here.
Coronavirus finally got kicked from the headlines…
Yesterday, the crisis in the oil market took center stage. With demand falling, capacity filling up, and a bit of wonkiness in the futures market, prices actually went negative on Monday.
Oil prices won't stay negative, of course. And I'm sure you're wondering where they're headed next. But the more important thing is what this decline means for the companies that produce it.
Unfortunately, oil and gas producers are tied to what they sell. It's that simple…
If oil prices fall below a certain level, oil producers run at a loss. And eventually, some of them will go out of business.
There's no way to get around it. And no matter where oil settles after this week's crash, that's the reality many oil producers are facing today. The cost to produce oil is higher than what they can sell it for.
The entire sector is in a massive downtrend as a result. And history says those lows could lead to double-digit losses from here.
Let me explain…
The S&P Oil & Gas Exploration & Production Select Industry Total Return Index is down 55% so far this year.
The crash in oil prices has absolutely crushed these companies. And we are seeing decade-plus lows in this sector because of it.
Importantly, history says the pain isn't over yet…
You see, the index hit a new 52-week low in March. And it's currently trading at its lowest level since 2003. Take a look…
The collapse in the oil market is hitting these companies directly. They can only wait for the oil price to turn around before things ease up.
With oil prices still down dramatically, these producers remain at decade-plus lows. And history says this is a bad sign going forward.
Since 2000, similar new 52-week lows have led to further losses in the sector. Two decades worth of data points to another 14% fall from here. Check it out…
Editor's Note: Click here to keep reading and see the data.
Man who predicted GM fall identifies next big bankruptcy
No one believed Porter Stansberry years ago when he said the world's largest mortgage bankers (Fannie Mae and Freddie Mac) would soon go bankrupt.
And no one believed him when he said GM would fall apart… or that the same would happen to General Growth Properties (America's biggest mall owner)… or that oil would fall from over $100 per barrel to less than $40 a barrel.
But in each case, that's exactly what happened.
And now, Stansberry says something new and even bigger is quietly unfolding in America (watch his video clip here):
In short: A terrifying new trend is creating thousands of new millionaires (Barron's estimates 20,000 to 200,000 so far) while at the same time destroying the financial future for many others.
Stansberry says this new trend is going to cause tens of millions of people to lose their jobs… it will also cause many major bankruptcies… yet at the same time it will make millions of others, incredibly rich.
Don't get left behind. Get the facts for yourself here.
Porter Stansberry went on camera for 10 minutes from his corporate headquarters to explain the full story. You can watch it free of charge here…